Cameco to receive CAD300 million tax refund

The reassessments are the latest development in a long-standing tax dispute between Cameco and the CRA, and follow an earlier series of court decisions in Cameco's favour for the 2003, 2005 and 2006 tax years which determined that income earned by Cameco’s foreign subsidiary from the sale of non-Canadian produced uranium was not taxable in Canada.

"In accordance with these decisions, CRA has issued reassessments reducing the proposed transfer pricing adjustment from CAD5.12 billion to CAD3.25 billion, resulting in a reduction of CAD1.87 billion in income taxable in Canada compared with the previous reassessments issued to Cameco for the 2007 through 2013 tax years. These revisions to income result in the refund of approximately CAD300 million described above," the company said.

The company noted that its broader tax dispute with the CRA - which continues to hold a further CAD480 million (CAD206 million in cash and CAD274 million in letters of credit) remitted or secured by the company - is still ongoing. This is "tying up a significant portion of our financial capacity", it said.

The company maintains that "clear and decisive court rulings already rendered in this dispute" relating to the sale of Canadian-produced uranium by the company's foreign subsidiary should also apply to the remaining transfer pricing adjustment of CAD3.25 billion for the 2007 to 2013 tax years, and that CRA should "fully reverse" the adjustments for those years, return the cash and security, "and bring this matter to an end once and for all".

Cameco filed appeals with the Canadian tax court in 2021 for the 2007-2013 and in October 2022 for the years 2014 and 2015. It has recently filed a notice of objection for 2016. "The process to resolve these disputes continues," the company said.

The timing of the refund is yet to be determined.