Barrick’s 36.95% Tax Rate

Check out this blog from our Executive Director, Bob Fulkerson and join us in Carson City on February 14th at Nevada’s legislative building to call on our legislators to remove the mining industry’s special protections from our state’s constitution.

Barrick’s 36.95% tax rate

The government of the Dominican Republic has extracted a deal from the world’s largest gold producer, Canadian-based Barrick Mining, to pay 3.2 percent of gross production, 25 percent for income tax and 8.75 percent from net earnings. This will amount to $11 billion in tax revenue from one mine.

Barrick, like other mining corporations in Nevada, pays an effective mining tax rate of 1% into Nevada’s General Fund. Like all of us, they pay a sales tax and a property tax (but not on the value of the gold beneath the land, and not if the land is public land, as 30-40% of all mining is in Nevada). Finally, thanks to a law signed by Ulysses S Grant in 1872, mining pays no royalties for minerals extracted on federal lands.

Nevada lawmakers have given away our riches for too long. It’s time to end the tax loopholes, remove mining’s protection from the Constitution, and pass Senate Joint Resolution 15 (SJR15). There can be no compromise. The Legislature either passes it this session, or forever keeps its sweetheart deals.

Remember: the Legislative Counsel Bureau has determined that passing SJR 15 will not lower or raise the amount of taxes mining pays. If SJR 15 is passed by the Legislature in 2013 and affirmed by the voters in 2014, mining’s tax protections would be removed from the Constitution yet remain in state statute. The Legislature would then be free to determine a fair rate of taxation.

Mining will stop at nothing to protect its obscene profits. The industry has doled out millions to lawmakers in campaign cash, and has more lobbyists than any other industry. They’ve spent untold cash on a public relations campaign, paid economists to paint a rosy picture of how much mining does for Nevada, and they continually boast about their donations to civic causes.

If you see through this smokescreen of lies like we do, the time to act is now.

Contact your Legislators and tell them to pass SJR 15.

Come to a news conference on Thursday, February 14th at 12:00pm (noon) on the front steps of the Nevada Legislature in Carson City. The relationship between our state Constitution and the mining industry in Nevada is a dysfunctional one, and it’s time to break up. RSVP here.

One Comment

  1. 2011 Barrick Mining Fact Sheet

    The 2011 Barrick Mining annual report is out. If you read it, there are some very interesting facts that emerge. This is a link to the Barrick Annual Report for 2011.
    Barrick Mining either owns outright, or is a partner in a joint venture in 7 gold mines in Nevada. To determine my estimate a profits for 2011, I assumed the price of gold at $1500 per ounce, or less. The current price for gold is in excess of $1750 per ounce. The first four mines listed are totally owned by Barrick Mining. In 2011, according to their own figures, Barrick Mining produced almost 97 TONS of gold from their Nevada Mines. That is same weight as 16 full size, original HUMMERS. Barrick Mining has reported record profits and dividends in both 2010 and 2011.
    The Cortez Hills Mine produced 1.42 Million (44.375 tons) ounces of Gold at a cost of $245 per ounce. If you assume a conservative profit of $1000 per ounce, you get a profit for the Cortez Hill mine of $1,420,000,000. Barrick paid a total of $47,300,000 in local and state taxes last year.
    Bald Mountain Mine produced 93,000 ounces (2.9 tons) at a cost of $558 per ounce. Assuming a profit of $900 per ounce for the Bald Mountain Mine, you get a profit of $83,700,000.
    The Gold Strike mine produced 1.09 MILLION ounces (34.0625 Tons) at a cost of $511 per ounce. Again assuming a profit of $900 per ounce for the Gold Strike mine, you get a profit of $981,000,000.
    Ruby Hill mine produced 127,000 ounces (3.96875 tons) at a cost of $334 per ounce. Assuming a profit of $1000 per ounce for Ruby Hill, you get a profit of $127,000,000.
    Barrick Mining is involved in three joint ventures in Nevada.
    Barrick owns 33% of the Marigold mine. Barrick’s share of production was 51,000 ounces (1.59675 Tons) at a cost of $761 per ounce. For the Marigold mine, assume a profit of $700 per ounce. The total profit would be $35,700,000.
    Barrick owns 50% of the Round Mountain mine. Barrick’s share was 178,000 ounces (5.5625 Tons) at a cost of $612 per ounce. Assuming a profit of $800 per ounce for the Round Mountain mine, we get a total profit of $142,400,000.
    Barrick owns 75% of the Turquoise Ridge mine which produced 135,000 ounces (4.21875 Tons) at a cost of $569 per ounce. Finally for the Turquoise Ridge mine, assume a profit of $700 per ounce. This would give a profit of $ 94,500,000.
    Barrick is actively exploring in the Carlin Trace in Nevada. The Carlin Trace is one of the richest gold deposts in the world. Barrick’s annual report shows that 44% of the companies income comes from North America. Don’t forget that Barrick is also mining silver along with the gold in Nevada. If you add all of the projected and conservative profits, the total is $2,884,300,000. This is a conservative estimate. According to the sources, the mining industry paid approximately $253,300,000 in state taxes. This amount is the total paid by all mining companies on all minerals mined in Nevada.