The significant judgment involved in the process on this matter by the LRA relates to ambiguity in the application of the Lesotho Income Tax Act and related guidelines such as ordinances, circulars and letters as well as tax opinions prepared by qualified in-house or external tax advisors.
“Management believes the assessment to be contradictory to the application of certain tax treatments in the current Lesotho Income Tax Act and concluded the matter not to be an uncertain tax position,” Letšeng Diamond revealed in its financial statements for the fiscal year 2020, which were released last week.
The LRA earlier lodged an application before the High Court pertaining to this matter, which Letšeng is now challenging.
An amended tax assessment was issued to the mining company by the LRA in December 2019, contradicting, according to Letšeng, the application of certain tax treatments in the current Lesotho Income Tax Act 1993.
It is the normal business of LRA to raise assessments, make rulings, directions and decisions on taxpayers.
Where the taxpayer is dissatisfied with the tax assessments raised against him them by the Commissioner General of LRA, the tax payer may file a notice of objection.