Audit by the Federal Court of Auditors (TCU) revealed that the mineral sector has withheld a considerable portion of financial compensation for the exploration of mineral resources (Cfem), known as royalties of mining.
Problems were also encountered in relation to the annual rate per hectare (TAH), although on a smaller scale. The situation is aggravated because, in addition to significant tax evasion, there is difficulty in supervision by the National Mining Agency (ANM).
The findings of the TCU audit are in a report signed by reporting minister Benjamin Zymler, placed on the agenda in the plenary session this Wednesday (2), but later withdrawn.
The matter should be considered in the next session, scheduled for October 9th. The document states that, between 2017 and 2022, 69.7% of holders of 30,383 active processes in the mining concession and licensing phase did not spontaneously pay the tax. Furthermore, in the 134 processes supervised by ANM, in which there was a spontaneous collection, an average evasion percentage of 40.2% was observed.
The TCU pointed out that problems already identified in previous audits carried out by the court itself in 2018 and 2022 persist. It also notes that signs of insufficient financial compensation collection were also identified by the Comptroller General of the Union (CGU), which found a average percentage of evasion of 30.5% in an analysis involving the period from 2014 to 2019.
The CGU concluded that the agency’s inspections were being carried out without planning and that the information systems used were flawed and insufficient.
According to the TCU audit, considering the verified tax evasion of 40.2%, a total of R$ 12.4 billion were not collected with Cfem between 2014 and 2021. If the percentage of 30 is applied to the same period, 5% calculated by the CGU, the value would be a little lower, but still quite significant: R$9.4 billion.
Billionaire loss
The TCU also points out that at least R$4 billion has already been permanently lost. This amount refers to the total of expired and prescribed credits in the period from 2017 to 2021. In other words, they can no longer be collected.
Decline is declared when ten years pass without the agency being able to complete the process of determining amounts owed, notifying debtors, analyzing possible appeals and establishing credit. Prescription occurs in cases where the credit is created but, after five years, there have been no measures for its registration in active debt and judicial collection.
Of these definitively lost values, the municipalities most affected were Parauapebas (PA), Ouro Preto (MG), Mariana (MG) and Itabira (MG). Each of them stopped receiving amounts above R$200 million. Among mining companies, Vale benefited most from the decadence and prescription, failing to pay R$2.86 billion.
Financial compensation for the exploration of mineral resources must be paid by mining companies that develop mineral exploration.
Calculating values depends on specific and exclusive information for each project. The collection is divided between the different federative levels: 90% goes to the states and municipalities involved and 10% to the Union. According to the legislation, mining companies must calculate and collect royalties spontaneously, with ANM being responsible for investigating any underpayments and collecting them. credits.
It turns out that, according to the TCU report, the data has not been properly monitored. The report points out that, in 2022, only 17 mining companies had their information checked by ANM.
The annual fee per hectare -TAH – is a financial charge charged during the mineral research phase, before exploration. As it depends only on the size of the area approved in the permit granted to the mining company, inspection is easier and requires tools and systems that perform less complex calculations. The TCU found an average tax evasion of 8.2% involving TAH in the period between 2017 and 2022. These are much lower percentages compared to what was observed in the analysis involving Cfem.
Furthermore, TAH represents a small portion of the resources raised by ANM.
The TCU audit points out that, between 2017 and 2021, Cfem accounted for 97.1% of the R$26.5 billion in mining financial charges raised by the agency. Even so, the sanction for royalty evaders is milder. As noted by the TCU, a mining company that does not pay the TAH may have its research license declared null, but one that does not collect the Cfem is only punishable by a fine and there is no impact on the continuity of its activities.
Limited supervision
ANM was approached by Brazil Agencybut did not manifest himself. As stated in the audit report, she told the TCU that the main causes for the limited oversight of Cfem’s payment are the reduced staff, the absence of specialized tools and the lack of sharing of information with the Federal Revenue Secretariat ( SRF) and with the state finance departments.
To the TCU, the ANM also estimated that at least 200 more employees would be needed to satisfactorily meet the inspection demand. Currently the team responsible for this task has only four employees and a boss. The agency acknowledged that its current systems do not allow for “monitoring the actual fiscally recorded mineral production”, making it impossible to have knowledge of how much is not collected. It maintained, however, that its organizational structure of positions should be compatible with that of the largest regulatory agencies.
The data presented shows that, although the ANM is responsible for regulating a sector that represents between 2.5% and 4% of the country’s Gross Domestic Product (GDP), its budget allocation for technology expenses exceeds only that of the National Cinema Agency (Ancine) and the National Waterway Transport Agency (Antaq).
On the other hand, it is below the National Telecommunications Agency (Anatel), National Agency for Petroleum, Natural Gas and Biofuels (ANP), National Health Surveillance Agency (Anvisa), National Land Transport Agency (ANTT), National Aviation Agency Civil (Anac), National Supplementary Health Agency (ANS) and National Water and Basic Sanitation Agency (ANA).
The TCU, however, indicated that the precariousness of the ANM structure does not result from a lack of resources, as there are its own revenues defined by law. He noted, however, that part of them are set aside every year by the federal government.
Furthermore, the audit recalled that the Union is entitled to 10% of the revenue from Cfem, with 70% of this share going to ANM. In this way, the amounts lost due to tax evasion would generate revenue in an amount greater than the investment necessary to structure the agency.
In his report, Minister Benjamin Zymler proposed a series of recommendations to the ANM, including the preparation of forecasts for each revenue, the adoption of a computerized system to support inspection and the creation of a manual of procedures to monitor Cfem payments.
Wanted by Brazil Agencythe Brazilian Mining Institute (Ibram), which represents the largest mining companies in the country, did not comment on the data on tax evasion collected by the TCU. On the other hand, the entity spoke out in defense of strengthening the ANM, mentioning the need to rebuild the staff and guarantee adequate financial resources for its full functioning. “We also defend the non-contingency of the 7% of Cfem allocated to the agency, an essential measure so that it can perform its functions effectively and efficiently”, adds the text.
