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Tharisa PLC on Monday said the South African tax court has delivered a ‘favourable judgement’ in the case between its subsidiary and the Commissioner for the South African Revenue Service. The Cyprus-headquartered platinum miner said the case involving Tharisa Minerals Proprietary Ltd related to the determination of mining royalties. Tharisa said the court set aside SARS’s assessments for 2015 and 2017 and told it to reassess the method used to calculate Tharisa Minerals’ gross sales and earnings before interest and tax. The court said SARS needed to take into account the ‘operational realities on recoveries and related costs’, specifically the grade recovery cure for Tharisa minerals. It said the judgement applies to every year of assessment from 2015 onwards. SARS has the right to appeal the judgement. The case related to the calculation of gross sales and Ebit values for platinum group metals. SARS had increased the gross sales value to the minimum specified condition of 150 parts per million, by adjusting the average platinum group metals grade on a linear basis. Tharisa Minerals appealed against this by contesting the methodology and SARS’ determination of incremental cash costs required. At the end of 2024, Tharisa had raised a provision of $56.8 million for the disputed mining royalty. The firm said it is now recalculating the liability, as well as the impact on cost of sales and income tax, using the principles set out in the judgement. It expects the impact to be ‘materially favourable’ to earnings per share, but the detailed recalculation remains in progress. ‘This was a highly technical matter, requiring alignment of complex metallurgical processes with the provisions of the Royalty Act. The case was argued primarily on principles of law rather than calculations, which are still being finalised. The judgement now provides certainty for the life of mine in determining mining royalties, taking into account the unique characteristics of our ore body,’ said Chief Financial Officer Michael Jones. ‘Importantly, it confirms that royalties should not be levied on notional or artificial income, which is especially prejudicial to producers mining lower-grade ore bodies. While the process has been lengthy, the outcome vindicates Tharisa Minerals’ position and highlights the need for more clarity from a legislative perspective.’ Shares in Tharisa were up 1.3% at 99.02 pence in London on Monday morning. The stock was flat at R 24.00 in Johannesburg. Copyright 2025 Alliance News Ltd. All Rights Reserved.
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