JOHANNESBURG: The South African Chamber of Mines has expressed concern over a report by the United Nations Conference on Trade and Development (UNCTAD), which indicates that the country is loosing revenue due to under-invoicing of the country’s commodity exports. In the report released on July 16, the UNCTAD says countries dependent on commodities are losing about 67 percent of their exports worth billions of dollars due to trade misinvoicing.
South Africa was mentioned as one of the countries misinvoicing its commodities to some countries. Roger Baxter, CEO of the Chamber, told Xinhua that they do not agree with the report. “We have noted the report with concern … “The Chamber is confident that the South African gold export statistics reported by the companies over the past few decades match the average rand gold prices and production numbers,” he said. Baxter said South Africa has a world-class regulatory and tax enforcement regime and the opportunity for mis-pricing is small. He said the country applies the OECD (Organisation for Economic Co-operation and Development) Transfer Pricing Guidelines for Multinational and Tax Administrations and the UN’s Practical Manual on Transfer Pricing. “The Chamber members undergo regular, stringent audits in accordance with international accounting standards, and report in compliance with legislation and listing requirements.
South Africa is acknowledged to be leading implementation of the OECD transfer pricing, base erosion and profit shifting guidelines,” the CEO said. The Chamber said that last year they commissioned an independent research on the country’s transfer pricing regime and specifically on how it measures up to international standards.
The research showed that South Africa has been adhering to the best international standards since the mid-1990s with respect to its transfer pricing rules. “The Chamber has drawn the report to the attention of relevant local authorities. We have written to both the author of the report and UNCTAD to request a call/ meeting to engage on the report,” he said. On Thursday, Statistics South Africa’s Statistician General Pali Lehohla also criticized the report, calling it “irresponsible”. Lehohla said the UNCTAD needs to consult a country before issuing the report.
