Consultant - Nickel Pricing for Taxation Purposes

About 

The International Institute for Sustainable Development (IISD) is an award-winning independent think tank working to accelerate solutions for a stable climate, sustainable resource management, and fair economies. Our work inspires better decisions and sparks meaningful action to help people, and the planet thrive. We shine a light on what can be achieved when governments, businesses, non-profits, and communities come together. IISD’s staff of more than 300 experts come from across the globe and from many disciplines. With offices in Winnipeg, Geneva, Ottawa, and Toronto, our work affects lives in nearly 100 countries. IISD hosts the secretariat of the Intergovernmental Forum on Mining, Minerals, Metals and Sustainable Development (IGF).

The IGF’s Global Mining Tax Initiative (GMTI) helps countries to increase mining revenues for sustainable development. Drawing on broad experience working with IGF member governments, the Secretariat offers this specialized and comprehensive program covering fiscal policy for the entire mining value chain, from exploration and development to mining, processing, mineral sales, and mine closure. The GMTI focuses on all aspects of fiscal policy, including taxes, royalties, and financial modelling and has unique expertise on international tax challenges related to the global mining sector, which is dominated by multinational companies. One of our key areas of work is mineral pricing.

The challenge

In the mining sector, royalties and income taxes are usually levied on the price received for the minerals produced multiplied by the volume. The price might be the actual sale price received or a relevant quoted price, if there is one. Government revenue thus depends on mineral products being priced and measured accurately.

However, pricing is not always straightforward. It may be complicated by the different stages of mineral beneficiation, the lack of publicly quoted prices for some minerals, and any adjustments based on the quality or grade of the product, as well as deductions for transport and insurance costs.

These factors can be even more complicated in the case of related-party sales, where there is an incentive to set artificially low prices to reduce taxable income in the mining country and shift profits offshore.

Unless governments are confident that the values declared by companies are accurate, suspicion and doubt will continue to erode trust between government and industry, which in turn affects companies’ social licence to operate. And if the value is being under-reported, governments can lose millions in tax revenues.

Our response

The IGF-OECD practice note, Determining the Price of Minerals: A Transfer Pricing Framework provides practical and meaningful guidance for developing countries to accurately delineate the transaction and price of mineral sales to support revenue collection in the mining sector. To complement this practice note, we have published applications of this framework to specific minerals. Bauxite and lithium are available, and a schedule for copper is being finalised for publication. The next schedule to be published will be related to nickel.

Deliverable – Technical Input for Nickel Pricing Schedule

As mentioned, the IGF and the OECD jointly prepared a practice note: ‘A Mineral Pricing Analytical Framework for Transfer Pricing Purposes’ under a programme of cooperation between the Organisation for Economic Co-operation and Development (OECD)’s Centre for Tax Policy and Administration Secretariat and the IGF, as part of a wider effort to address some of the challenges developing countries are facing in raising revenue from their mining sectors. The practice note contains several schedules that apply the framework to a specific mineral. Nickel has been selected as one of the minerals that will be covered under the practice note.

IGF seeks a consultant who will, firstly, provide training to IGF’s nickel-producing member countries on the valuation and pricing of nickel. The consultant will be responsible for preparing the training materials and conducting the virtual training. Secondly, the consultant will provide feedback to the Nickel Pricing Schedule to be developed by IGF and OECD. Lastly, once the Nickel Pricing Schedule has been released for public consultation, the consultant will be tasked to assist the IGF and OECD with addressing technical questions that we receive from the public consultation.

Timelines

Location

Remote. IISD will not be applying for residency, and work permits for this position on behalf of the applicant.

Candidates must hold appropriate work authorisation for locations where they expect to be based.

Deadline of Application

Applications will be reviewed on a rolling basis until filled.

Application Process

This is a consultant position. Submissions must be in English.

Please include the following:

A CV (detailing your experience with nickel pricing)

An expression of interest (one page)

Only those candidates we wish to interview will be contacted.

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