Extractive industries report: Quarries owe Government $193m

Quarry operators owe the Government $193 million in royalty payments, according to the TT Extractive Industries Transparency Institute’s eighth annual report launched on Wednesday.

“(The arrears) is due to the under reporting of mineral production volumes and the challenges in collecting royalties owed,” the report said.

It said between 2004 and 2019, Government should have received $222 million from quarry operators. Payments actually amounted to $29 million.

The report also indicated a steady decline in royalties between 2017 and 2020 with sums amounting to $7.9 million in 2017. The report explained the decline in revenue was attributable to a decline in the production of minerals.

“Total production in 2019 was 2,046,100.96 cubic metres and fell to 1,619,550.35 metres in 2020,” the report said.

The report called for significant improvement in the Ministry of Energy’s monitoring of revenue payments, saying the ministry does not independently verify production volumes, but relies on reports from operators.

The report was compiled by PKF Ltd, in partnership with Engaged Consulting Ltd and Michael Barron Consulting. At the launch held virtually, TTEITI chairman Gregory McGuire called for mandatory reporting to be part of the reforms in extractive industries legislation.

“Under the current arrangements companies report their revenues and other key data on a voluntary basis. Moreover the Income Tax Act bars the Board of Inland Revenue (BIR) from disclosing such tax information to third parties including the auditor general, so the information is now obtained through a time-consuming process requiring a legal covenant between the BIR and the companies,” McGuire said.

He said the institute has, since 2014, drafted policies to not only overcome the legal barriers but to make them mandatory.

“The legislation is now before the minister and we at the TTEITI advocate for its enactment,” McGuire said.