10 Jul 2024 17:10

Kazatomprom enterprises to pay mineral extraction tax at differentiated rates from 2026

ALMATY. July 10 (Interfax) - Joint ventures and subsidiaries of Kazatomprom will be subject to mineral extraction tax at differentiated rates from 2026, Kazakhstan's national nuclear company said in press release.

The changes are related to amendments to the tax code, introduced on July 1, 2024, regarding the calculation of the mineral extraction tax on uranium, paid at the level of mining enterprises.

From January 1, 2023, the tax base for the mineral extraction tax on uranium is determined as the weighted average price for uranium (in the form of natural uranium concentrate U3O8) from public sources for a certain reporting period, multiplied by the amount of uranium mined and the mineral extraction tax rate of 6%.

Starting from January 1, 2025, the applicable mineral extraction tax rate on uranium will be increased to 9%.

From January 1, 2026, a differentiated approach will be introduced for calculating the mineral extraction tax on uranium, depending on the actual annual production volumes for each subsoil use contract and prices for natural uranium concentrate (U3O8). Thus, the mineral extraction tax for annual production up to 500 tonnes will be 4%, up to 1,000 tonnes - 6%, up to 2,000 tonnes - 9%, up to 3,000 tonnes - 12%, up to 4,000 tonnes - 15% , over 4,000 tonnes - 18%.

If the weighted average price of natural uranium concentrate (U3O8) exceeds the prices established below, the mineral extraction tax rate increases by the following amount: over $70 per pound - 0.5%, over $80 per pound - 1%, over $90 per pound - 1, 5%, over $100 per pound - 2%, over $110 per pound - 2.5%.

The company noted that the above changes to the tax code would go into effect on January 1, 2025 and would not affect the company's tax expectations for 2024.

Kazatomprom is the national operator of Kazakhstan for the export of uranium and its compounds, rare metals, nuclear fuel for nuclear power plants and special equipment. It mined 21,112 tonnes of uranium in 2023, 1% less than in 2022. It is managed by National Wealth Fund Samruk-Kazyna JSC, with shares and GDR traded on the London Stock Exchange and Astana International Financial Center Exchange.