Taxes
Nevada Gold Mines pays all Nevada state taxes including Sales and Use and Modified Business Tax. In addition, mining is one of a handful of Nevada industries that pays an additional industry-specific tax, the Net Proceeds of Minerals Tax (NPT). As a result, mining is the second highest-taxed industry in the state as a percentage of revenue.*
The Net Proceeds of Minerals Tax was added to the State Constitution in 1989. It is a property tax on mineral value and is capped at 5% — the highest allowable property tax rate allowed by the Nevada Constitution. Revenue is divided between the state general fund and the counties in which the minerals are produced.
In a Special Session of the Nevada Legislature, which commenced on July 8, 2020, a bill was passed that temporarily requires the advance payment of the portion of the NPT that is distributed to the State General Fund. This bill is similar to legislation introduced in 2009 following the Global Financial Crisis, and had been part of discussions between Nevada Gold Mines and the Governor of Nevada in the first half of 2020 on measures to support the State through the Covid-19 pandemic.
In February 2021, Nevada Gold Mines paid $72 million to the General Fund, representing the advanced portion of its estimated 2021 NPT liability. This will be in addition to an expected $147 million to be paid in May 2021, representing the 2020 related NPT payment of which roughly 50% ($73 million) will go directly to the General Fund, the other 50% to the counties in which NGM operates. Together, this will bring Nevada Gold Mines’ total NPT payments in 2021 to $219 million, $145 million of which will go to the State General Fund — equivalent to a year on year increase of 133% and 210% respectively.
The NPT is the economic lifeblood for many rural communities and makes up a significant portion of county revenue. To redirect the county portion of the NPT would result in the need for counties to directly draw from the state general fund instead.
Nevada Gold Mines generated federal tax charges for its owners, Barrick and Newmont, of $200 million in 2020. Barrick, the operator of Nevada Gold Mines, as a foreign investor also paid taxes of $104 million in repatriating profits.**