Fiji’S Gold Mines

Big Profits—And Very Big Taxes

IN the year ended June 30 last, the Em peror and Loloma gold-mines, in the Tavua district of Fiji, won just on £1,000,000 worth of gold, thus maintaining most satisfactorily Fiji’s third big in dustry—the other two, of course, being sugar and copra production.

The following table shows what ,the mines actually accomplished:—

Ever since the courage and enterprise of a Melbourne group, headed by John Wren and E. G. Theodore, established this rich industry on an ore that had been sneered at by most of the experts, the Companies have had a raw deal from tax-hungry governments—especially in the post-war, or Socialist, era.

In Australia, the profits of Australian gold-mines are free of income tax —as they should be, considering the enterprise needed to find gold, the risks taken, and the way in which the producers are mulcted in royalties, and so forth. But in Fiji the mines get no such concession —they are heavily taxed. Yet in recent years, the companies could not transfer their profits (already taxed) from Fiji to Australia, because Australia simply classi fied them as “oversea companies,” and insisted that their dividends were subject to a fearful slug. So the Directors, for years, wisely kept their profits, undivided, in Fiji.

Some of those profits were ear-marked for a scientific search for gold in Guadal canal, in the Solomons, where there are encouraging prospects. But when the new British Socialist set-up announced that, in the event of gold being found in the Solomons, the State would participate heavily in the returns, the directors simply closed down their Solomons enterprise, and cut their losses.

Now comes the third set-back. The Fiji Government already imposes an income tax on the companies, equal to 6/3 in the £; and the new system of calculating royalty rates imposed on the gold ex ported means that the gold-mines will be paying out in direct taxation no less than 50 per cent, of their gross income.

It is described in Australia as “a ludi crous situation, and it means that the gold industry, despite the comparative richness of the field, will be forced out of the Colony.”

The Emperor and Loloma Companies have been very good for Fiji, in an econo mic and social sense. They employ large numbers of Fijian and half-caste people, and they have taken pride in organising and establishing model villages and amenities for both those communities.

“The Fiji Government tries to tax us as if we were South African mining com panies,” said a manager to a PIM visitor, not long ago. “I bet they never saw model workmen’s villages like these around any African mine.”

The* accounts show that the company expect that, in this financial year, Loloma will pay £48,255 and Emperor £37,406 in taxation, to the Fiji Government.

Because of shortage of European miners and lack of ore, the crushing mill at the Cuthbert mine on Misima Island. Papua, ran only ten days in the period ended November 23. 250 tons were crushed, for 43 oz. of gold and 41 of silver.

Gold Won Profit Oz. Value (£F) £ (A) Emperor, 1948 55,417 588,494 56,>637 1949 59,241 574,255 76.202 Loloma, 1948 29,042 88.839 1949 29,781? 128.083