August 17, 2018 / 12:34 PM / 3 months ago

Gemfields shares fall after Zambia tax authority issues search warrants

LUSAKA, Aug 17 (Reuters) - Gemfields’ shares fell more than 4 percent on Friday after it said that Zambia’s Revenue Authority (ZRA) had obtained warrants to search its Kagem emerald mine in an investigation into alleged tax evasion.

In May Zambia hit Canadian miner First Quantum Minerals with a tax bill of more than 76.5 billion Zambian kwacha ($8 billion) after a separate investigation.

Gemfields said in a statement that ZRA, which declined to comment on Friday, had served two search warrants during an unannounced visit to its Kagem Mining Limited on Thursday.

These authorised ZRA to take documents and files including those allegedly used to evade payment of Value Added Tax (VAT), income tax, with-holding tax and other taxes, Gemfields said.

The company did not say if any searches had taken place.

“Gemfields will provide further updates as pertinent information becomes available,” the company, which holds a 75 percent stake in Kagem emerald mine in Zambia, said.

Gemfields also holds controlling interests in gemstone mining and prospecting licences in Zambia, Mozambique, Ethiopia and Madagascar. (Reporting by Chris Mfula Editing by Alexander Smith)

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