CRA appeals $2.2B tax bill dispute decision that ruled in favour of uranium giant Cameco
Tax court ruled in September for the Saskatoon-based uranium company in spat dating back to 2009
The Canada Revenue Agency is appealing a Federal Court of Appeal decision involving a $2.2 billion tax bill dispute with Cameco.
In September, the Tax Court of Canada ruled in favour of Cameco, leaving the CRA with 30 days to appeal.
The revenue agency took issue with a Cameco subsidiary that sold uranium in Switzerland, saying it used the company to avoid paying taxes in Canada. Cameco maintained it was a legal and sound business practice and challenged the CRA's findings.
"We are disappointed that the CRA has taken this action after such a clear and decisive ruling from the Tax Court," said Cameco president and CEO Tim Gitzel in a news release.
Cameco's manager of communications, Carey Hyndman, said the company sees no reason why the original decision would be overturned.
"We are prepared to continue through the appeals process and we believe the appeal will be decided in our favour, just like the [original] decision was," Hyndman said.
Cameco estimates it could take years for the matter to be decided.
CRA spokesperson TJ Madigan said the government is "administering the acts for which it is responsible in a fair and impartial manner."
"The government is committed to protecting the tax base by ensuring that all Canadians meet their tax obligations," Madigan said in an emailed statement.
Decision 'thorough and clearly in Cameco's favour'
Cameco said it will still be making an application to the court to recover costs incurred over the course of the case.
The Tax Court decision and CRA appeal apply only to the 2003, 2005 and 2006 tax years, which were the subject of the original court case.
Cameco said it has already paid half of the $11-million bill for the three years in question and is expecting it will be refunded.
The company hopes courts will be persuaded to apply the decision to the entire $2.2 billion tax bill, which includes other tax years.
"We had hoped the CRA would have accepted that decision and applied it to the other years in dispute, because the decision that came from the tax court was really thorough and clearly in Cameco's favour," Hyndman said.
"There is nothing in the decision that we think would warrant a different outcome."
She isn't sure what the CRA is going to bring forward in its appeal.
In July, slow uranium prices meant Cameco indefinitely suspended production at its McArthur River and Key Lake operations. That resulted in the permanent layoff of 550 mine workers and 150 corporate head office employees.