Pascua Lama, gold to delay due to taxes

· Economics, Latin America

The Argentinian tax system is the responsible of the delay in the development of the biggest gold projects, said the Chilean goverment. Pascua Lama is a gold source among the two South American countries that is currently under the Canadian firm Barrick Gold Corp. Diferences among Argentina and Chile in what is the tax system to be applied, have delayed the beginning of the projects, while other issues were already resolved as the enviroment rules. The delay is increasing the costs, according with what Chile dennounced.

The extraction of gold and silver will be the main production of a mine that is said to be one of the biggest of the planet, but disagreements among Argentina and Chile are delaying the beggining of the proyects that would benefit their economies. The problem is that Chile proposed to pay the 80% of the taxes because the projects are more located in its territory, while Argentinia says that the taxes should be paid in equal proportions.

While the two goverments get an agreement in the issue, the original schedule is delayed and it gets more expensive due to the rise in the prizes of inputs like steel, engineering outsourcing and electricity. If the original cost of the project was USD 1,500 million, today it is reaching USD 2,400 million, according with AméricaEconomía.

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