Back Matter

Author(s):
Jack Calder
Published Date:
July 2014
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    References

      Biber, Edmund,2010, Revenue Administration: Taxpayer Audit—Development of Effective Plans (Washington: International Monetary Fund). www.imf.org/external/pubs/ft/tnm/2010/tnm1003.pdf.

      Crandall, William Joseph,2010, Revenue Administration: Performance Management in Tax Administration (Washington: International Monetary Fund). www.imf.org/external/pubs/cat/longres.aspx?sk=23956.0.

      Daniel, Philip, MichaelKeen, and CharlesMcPherson,eds., 2010, The Taxation of Petroleum and Minerals: Principles, Problems and Practice (Washington: International Monetary Fund and London: Routledge).

      Extractive Industry Transparency Initiative (EITI), n.d., Home page. http://eiti.org.

      Guj, Pietro, BoubacarBocoum, JamesLimerick, MurrayMeaton, and BryanMaybee,2013, How to Improve Mining Tax Administration and Collection Frameworks: A Sourcebook (Washington: World Bank).

      Humphreys, Macarton, Jeffrey D.Sachs, and Joseph E.Stiglitz,eds., 2007, Escaping the Resource Curse (New York: Columbia University Press).

      International Monetary Fund (IMF), 2007, Guide on Resource Revenue Transparency (Washington). www.imf.org/external/np/pp/2007/eng/101907g.pdf.

      International Monetary Fund (IMF), 2010, Managing Natural Resource Wealth (Washington). www.imf.org/external/np/otm/2010/110110.pdf.

      International Monetary Fund (IMF), 2011, Revenue Mobilization in Developing Countries (Washington). www.imf.org/external/np/pp/eng/2011/030811.pdf.

      International Monetary Fund (IMF), 2012, Fiscal Regimes for Extractive Industries: Design and Implementation, Fiscal Affairs Department Paper (Washington).

      Kidd, Maureen,2010, Revenue Administration: Functionally Organized Tax Administration (Washington: International Monetary Fund). www.imf.org/external/pubs/ft/tnm/2010/tnm1010.pdf.

      Natural Resource Charter, n.d., Home page. www.naturalresourcecharter.org.

      Organization for Economic Cooperation and Development (OECD), 2010, Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations (Paris). www.oecd.org/ctp/transfer-pricing/transfer-pricing-guidelines.htm.

      Otto, James, CraigAndrews, FredCawood, MichaelDoggett, PietroGuj, FrankStermole, JohnStermole, and JohnTilton,2006, Mining Royalties: A Global Study of Their Impact on Investors, Government and Civil Society (Washington: World Bank). http://documents.worldbank.org/curated/en/2006/06/7045893/mining-royalties-global-study-impact-investors-government-civil-society-vol-1-2.

      Ross, Michael L.,2013, The Oil Curse: How Petroleum Wealth Shapes the Development of Nations (Princeton, New Jersey: Princeton University Press).

      Russell, Barrie,2010, Revenue Administration: Managing the Shadow Economy (Washington: International Monetary Fund). www.imf.org/external/pubs/ft/tnm/2010/tnm1014.pdf.

      United Nations, 2012, Transfer Pricing: Practical Manual for Developing Countries (New York). www.un.org/esa/ffd/tax/documents/bgrd_tp.htm.

      World Bank, 2008, Implementing the Extractive Industries Transparency Initiative: Lessons from the Field (Washington).

      Zee, Howell H., Janet G.Stotsky, and EduardoLey,2002, “Tax Incentives for Business Investment: A Primer for Policy Makers in Developing Countries,” World Development, Vol. 30, No. 9, pp. 1497516.

    Index

    Page numbers followed by n or t refer to footnotes or tables, respectively.

    A

    • Abandonment costs, 9, 86

    • Accounting periods, 38–39

    • Accounting system issues, 48, 55, 96

    • Administrative capacity

      • funding and autonomy and, 66–67

      • information management and, 66

      • introduction to, xi, 61–62

      • performance management and, 65–66

      • private sector’s role in, 67

      • recruitment practices, 63–64

      • reforms implementation and, 67–68

      • salary structures and, 63

      • staffing requirements and, 62–63

      • training issues, 64–65

    • Anticorruption strategy, 58

    • Appeals and dispute resolution, 49, 58

    • Arm’s-length principle, 70–76, 78–82

    • Artisanal mining, 4, 43

    • Auditing

      • adjustments related to, 48, 93

      • aggressive and unfair, 46

      • CIT and, 46

      • integrity issues and, 57

      • joint or collaborative, 34

      • nonroutine functions, 45–49

      • nontax, 47

      • payment in kind and, 42

      • physical, 29, 45, 64

      • recruitment practices for, 64

      • risk assessment, 47, 96

      • specialized skills for, 16

      • streamlined procedures and, 55–56

      • tax design and, 20

      • of tax returns, 46

    • Average prices, 72, 75

    B

    • Back-loaded costs, 9, 86

    • Benchmark prices

      • establishing, 45–46

      • mineral valuation and, 79

      • natural resources and, 5

      • special expertise for, 5

      • tax department and, 29

      • tax design and, 19

      • valuation rules and, 73

    • Bribes, 58, 63

    • Budget processes, 23, 54, 55

    C

    • Capital expenditure, 85–86

    • Capital gains, 48, 87

    • Capital investment, 8–9, 12

    • Change management, 67–68

    • Commercial risk-sharing agreements, 10–11

    • Community service, 24, 27

    • Compliance strategy, 26, 27, 43

    • Concessionary regimes, 13, 41

    • Consortium agreements, 10–11

    • Consumption incentives, 89

    • Corporate income tax (CIT)

      • auditing issues, 46

      • foreign tax credit and, 9, 28

      • production sharing regime and, 28

      • RRT and, 20

    • Corruption issues, 14, 63

    • Cost allocation, 48, 84

    • Customs import exemptions, 88

    D

    • Deepwater Horizon accident, 6

    • Depreciation, rules for calculating, 86

    • Depreciation rates, 21, 47, 64

    • Developing economies

      • exports and import issues and, 10

      • information technology in, 66

      • royalty issues, 19

      • transfer pricing rules in, 71

    • Development expenditure, 85

    • Dividends, 23, 24

    • Dollar accounting and payment, 36, 41, 66

    • Domestic processing, 89

    • Double taxation, 5n, 73, 88

    • Downstream operations, 1, 69, 70, 74, 75

    • “Dutch disease,” 51n

    E

    • Electronic filing and payment, 42

    • Equity participation

      • disclosure of, 53

      • full, carried and free, 12

      • government, 23–24, 53

      • risks related to, 12

      • tax administration and, 14

    • Exploration expenditure, 85

    • Exports and imports issues, 10

    • Extraction rights, 2–3

    • Extractive Industries Transparency Initiative (EITI)

      • focus of, 56–57

      • payment in dollars and, 10

      • phases of, 56

      • purpose of, x

      • self-assessment and, 37–38

      • support for, 56

    F

    • “Farm-outs,” 87

    • Financing

      • costs, 81–82

      • for natural resources, 7

      • tax treatment of, 8–9

    • Fiscal decentralization, 26, 30

    • Fiscal legislation, scattered, 53

    • Fiscal policy issues, 8, 18, 25

    • Fiscal provisions, badly designed, 21–22

    • Foreign currency accounting, 41

    • Foreign tax credit, 9, 28

    G

    • Gas valuation, 75–76

    • General tax administration, 28, 31, 35, 62, 64, 66

    • Geographic concentration issues, 9–10

    • Governance and transparency

      • assurances of integrity and, 57–59

      • clarity of roles and, 52–54

      • introduction to, x–xi, 51–52

      • investments and, 52

      • open budget processes and, 54

      • public availability of information and, 54–57

      • See also Natural resource revenue administration

    • Governments

      • anticorruption strategy by, 58

      • equity participation, 23–24, 53

      • investment incentives by, 8, 9

      • provincial and local, 30–31

      • stability agreements by, 9, 21, 52

      • subsidies by, 10

      • See also National resource company (NRC); Natural resource taxes

    • Guidance and training materials, 65

    • Guide on Resource Revenue Transparency (GRRT)

      • assurances of integrity and, 57–59

      • clarity of roles and, 52–54

      • open budget processes and, 54

      • public availability of information and, 54–57

    • Guide to Resource Revenue Transparency, 14

    H

    • Hedging

      • gains and losses, 82–83

      • natural resource prices and, 7

    I

    • Indirect transfer, 87

    • Information technology (IT), 33, 66, 96

    • Infrastructure development, 3, 24, 44, 83n

    • In-kind public revenue, 3, 13, 15, 42, 93

    • Integrated tax administration system (ITAS), 66

    • Interdepartmental task forces, 33

    • Interest

      • automatically charging of, 40

      • disguised, 82

      • financing costs and, 81–82

      • for tax audit adjustments, 48

    • International training courses, 65

    • Investment

      • allowances, 86

      • governance and transparency issues, 52

      • incentives for, 8, 9

      • tax holidays and, 85

    • In-year installments, 39, 79

    J

    • Joint ventures

      • agreements, 10–11, 23

      • audits, 47–49

      • transfer pricing issues, 80

    K

    • Key performance indicators (KPIs), 58, 97, 98, 99

    L

    • Large taxpayer office (LTO), 31, 32, 62–63, 97–99

    • Late payments, 36, 37, 40

    • Legal and policy framework, 14–15, 57–58

    • License agreements, 2, 44

    • License rights, 3

    • License transfers, 11, 87

    • Licensing procedures, 52

    • Liquefied natural gas (LNG), 75

    • Local government responsibilities, 30–31

    • London fixing price, 78

    M

    • Managing Natural Resource Wealth Topical Trust Fund (MNRW-TTF) program, 51, 52

    • Mineral valuation, 76–80

    • Mining projects

      • capital expenditure, 86

      • long operating period for, 9

      • no-profit rule for, 81

      • physical auditing of, 29

      • profitability issues, 4

    • Mining shadow economy, 43

    • MNRW-TTF program, 51, 52

    N

    • National resource company (NRC)

      • government equity and, 23

      • integrated administration by, 28–29

      • integrity issues, 58–59

      • ownership structure, 12, 53–54

      • payment in kind and, 41–42

      • physical audit issues, 45

      • responsibilities of, 30, 54

      • special considerations for, 44

      • special taxes and, 21

      • tax design and, 19

      • tax procedure codes and, 36

    • Natural resource revenue administration

      • accounting system issues, 48, 55, 96

      • challenges to, 8

      • combating corruption in, 14

      • consequences for, 14–15

      • evaluating and strengthening, 15–16

      • exploration risks and, 6

      • fiscal policy issues, 8, 18, 25

      • fragmented, 27–28, 53

      • funding for, 66–67

      • in-house capacity for, 67

      • information exchange issues, 32–33

      • integrated, 26–27, 33–34

      • for joint ventures, 11

      • legal and policy framework for, 14–15, 57–58

      • organization of, 26, 31–32, 34

      • special tax deals and, 7–8

      • staffing requirements for, 62–63

      • training and skills for, 64–65

      • transparency issues, 35

      • See also Procedures

    • Natural resources

      • benefits from, 51–52

      • capital expenditure, 85–86

      • capital investment for, 8–9

      • commercial participation in, 12

      • contracts, 52, 53

      • exports and imports issues, 10

      • features of, 2

      • financing for, 7

      • fiscal provisions, 21–22

      • geographic concentration issues, 9–10

      • license agreements for, 2, 44

      • license interests transfer, 11

      • long operating period for, 9

      • nonrenewability of, 2–4

      • policy and administration, 25t

      • poor governance, 14

      • prices of, 7, 10, 59, 72, 82

      • rent-generating potential of, 4–6

      • revenue report, 97–100

      • risk-sharing arrangements, 10–11

      • scale and profitability of, 4

      • state control and ownership, 11–14

      • taxpayers, 37, 62, 97, 99

      • uncertainty and risk issues, 6–8

      • valuation of, 45, 46

    • Natural resource taxes

      • accounting periods for, 38–39

      • administrative regime for, 42

      • allocating payments against, 40–41

      • appeals and dispute resolution for, 49

      • capital expenditure and, 85–86

      • complexity of, 20–21

      • consumption incentives and, 89

      • customs import exemptions and, 88

      • double tax agreements and, 88

      • economic models for, 95–96

      • financing costs and, 81–82

      • frequency of installments of, 39–40

      • gas valuation and, 75–76

      • hedging and, 82–83

      • implementation of, 19–22

      • license transfers and, 87

      • mineral valuation and, 76–80

      • oil valuation and, 74–75

      • payments for, 92

      • point of valuation and, 69

      • pricing basis and, 69–70

      • refund procedures, 41

      • ring-fencing of costs and, 84–85

      • separate returns for, 39

      • social infrastructure costs and, 86–87

      • streamlining and harmonizing, 91–93

      • tax deductibility of costs and, 83–84

      • tax holidays and, 85

      • transfer pricing and, 70–72, 80–81

      • unitizations and redeterminations and, 88

      • valuation rules and, 73

    • Netback pricing, 71

    • Net smelter return (NSR), 79, 80

    • Non-arm’s-length transactions, 7, 22, 45, 71–75, 80, 83

    • Noncash consideration, 87

    • Nonrenewable resources, 3, 4, 75

    • Nonroutine functions

      • appeals and dispute resolution, 49

      • audit, 45–49

      • benchmark pricing, 45–46

      • enforcement, 44

      • risk assessment and management, 42–43

      • segmentation and compliance strategy, 43

      • taxpayer services, 44–45

    • Nontax agencies, 16, 27, 62

    • Nontax audits, 47

    • Nontax reforms, 43

    • Nontax revenues, 23–24

    • No-profit rule, 80, 81

    • Nuisance taxes, 21, 31

    O

    • Obsolescing bargain, 9

    • Oil valuation, 74–75

    • One-off agreements, 7, 8

    • Open budget processes, 54

    • “Ordinary and necessary” costs, 83

    • Organization and cooperation

      • among agencies, 26

      • exchange of information and, 32–33

      • fragmented administration and, 27–28

      • integrated administration and, 28–29, 33–34

      • introduction to, x, 25–26

      • tax department and, 26–27, 29–31

    • Organization for Economic Cooperation and Development (OECD), 5, 80, 81

    P

    • Payment in kind, 13, 38, 41–42

    • Penalties

      • for nonfiling, 40

      • for nonpayment of royalties, 36n

      • for tax audit adjustments, 48

      • for in-year installments, 39

    • Performance management, 65–66

    • Petroleum extraction

      • capital expenditure, 85

      • physical auditing of, 29

      • PSAs and, 13

      • royalty issues, 2–3

      • transfer pricing issues, 80

      • uncertainty and risk issues, 6

    • Physical auditing, 29, 45, 64

    • Point of valuation, 69, 74, 76

    • Policy and legal issues

      • implementation of taxes and, 19–22

      • introduction to, ix–x, 17

      • nontax revenues and, 23–24

      • tax administration and, 18–19

      • taxation law accessibility and, 17–18

      • See also Governance and transparency

    • Poor governance, 14, 51, 52

    • Preference shares, 24, 82

    • Private sector

      • role of, 67

      • salary structure, 63

    • Procedures

      • introduction to, x, 35

      • nonroutine functions, 42–49

      • routine functions, 37–42

      • tax procedure codes, 36–37

    • Production expenditure, 85

    • Production sharing agreements (PSAs)

      • CIT and, 28

      • nontax revenues and, 23

      • NRC and, 30

      • payment in kind and, 41

      • for petroleum production, 13

      • tax appeals and, 49

      • tax procedure codes and, 36

      • transfer pricing and, 75

    • Profit-shifting, 5, 70, 85

    • Provincial government responsibilities, 30–31

    • Public availability of information, 54–57

    R

    • Recruitment practices, 63–64

    • Redetermination process, 88

    • References prices, 73, 74, 99

    • Refund procedures, 41

    • Rent taxes, 4–6, 19, 70

    • Resource curse, 51

    • Resource rent taxes (RRT), 4, 20t, 39, 46, 79, 91

    • Ring-fencing of costs, 5–6, 84–85

    • Risk assessment and management, 42–43, 47

    • Risk-sharing agreements, 10–11

    • Routine functions

      • noncompliance with, 43

      • registration, 37

      • self-assessment, 37–38

      • simplifying, 38–42

    • Royalties

      • complexity of, 7

      • deferral payment of, 44

      • description of, 2

      • fiscal authority issues, 53

      • mineral valuation and, 78

      • oil values for, 74

      • penalty for nonpayment of, 36n

      • petroleum extraction and, 2–3

      • versus profit and rent taxes, 19–20

      • reliance on, 6

      • tax return issues, 39, 46

      • valuation, 19, 77, 78, 79

    S

    • Salary structures, 63

    • Self-assessment

      • benefits of, 18, 37–38

      • compliance strategy and, 43

      • tax return, 91, 92

    • Social infrastructure costs, 86–87

    • Special tax deals, 7–8

    • Spot prices, 74, 75, 76

    • Stability agreements, 9, 18, 21, 22, 35, 52

    • Staffing requirements, 62–63, 65

    • State contract regime, 13–14

    • State control and ownership, 11–14

    • Stripping costs, 86

    • Sunk costs, 9

    T

    • Tax administration, 14, 18–19

    • Taxation law, accessibility of, 17–18

    • Tax auditing. See Auditing

    • Tax deductibility of costs, 83–84

    • Tax department

      • integrated administration by, 26–27

      • responsibilities of, 29–31

      • See also Natural resource revenue administration

    • Tax depreciation, 21, 85, 86, 95

    • Tax design and implementation, 6, 19–20

    • Tax holidays, 7, 8, 84n, 85

    • Taxpayer services, 44–45

    • Tax policy, 18–19

    • Tax procedure codes, 36–37

    • Tax returns

      • auditing of, 46

      • royalties and, 39

      • self-assessment, 91, 92

    • Technological expertise for natural resources, 8–9

    • Thin capitalization, 82

    • Training and skills, 64–65

    • Transfer pricing

      • domestic processing and, 89

      • exports and imports and, 10

      • general rules, 70–71

      • joint ventures and, 80

      • mineral valuation and, 77, 79

      • natural resource taxes and, 70–72, 80–81

      • procedures, 81

      • PSAs and, 75

      • in revenue administration, 5

      • specific rules and, 71–72, 81

    • Transparency. See Governance and transparency

    U

    • Unitizations, 88

    • Up-front fees, 6, 7, 8, 9

    • Upstream operations, 1, 5, 56, 69, 75

    V

    • Valuation prices, 45, 46

    • Valuation rules, 48, 73, 75, 83

    • Value-added tax (VAT), 10, 88

    W

    • Weighted average prices, 46, 72, 75

    • Withholding taxes (WHT), 10, 48, 82, 88, 91

    For a comprehensive discussion on natural resource fiscal regimes, see IMF (2012).

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