The parent company of Xstrata has been found to have systematically ripped off one of Africa's poorest countries, Zambia, by avoiding hundreds of millions of dollars in taxes through mechanisms like transfer pricing. An audit carried out by the Norwegian office of global auditor Grant Thornton, at the request of the Zambian Revenue Authority, uncovered the tax-avoiding activities of Mopani Copper Mines, 76% owned by giant transnational commodities broker Glencore. Glencore domiciled in the Swiss tax haven of Zug. Mopani is controlled through another haven, the British Virgin Islands. Glencore also controls transnational miner Xstrata (it too is domiciled in Zug), a key player in the defeat of the Rudd Government's RSPT. During the hysterical campaign against the tax, waged primarily by BHP, Rio Tinto, Xstrata, the Minerals Council of Australia and News Ltd, Zambia was held up as a model for Australia to follow in its taxation treatment of mining. Zambia had introduced a windfall mining tax in 2008, but reversed it in the teeth of the Global Financial Crisis in January 2009. In June last year, Mark Cutifani of Anglogold Ashanti urged the government to learn the lesson from Zambia. One of the ratings agencies at the heart of the GFC, Moody's declared that Zambia was "a cautionary tale" for Australia, in a statement approvingly quoted by the Minerals Council of Australia, especially when the Zambian Mines Minister said he hoped investors would leave Australia and switch to Zambia. While that was happening, it turns out, Zambia's taxes were being rorted by Glencore, according to a report obtained by a group of NGOs. The Zambian Government has sat on the report and, according to the owni.eu site, which broke the story, a blogger who posted the report online was intimidated into removing it by the Government. The report found that Mopani had sold copper to Glencore at 25% of the international price, depriving the Zambian Government of 75% of liable tax revenue. Mopani had also claimed a massive, but unexplained, rise in costs between 2006 and 2008, further cutting its tax bill. According to the report, the mining companies in Zambia actually pay less in tax than miners were paying in income tax. In statements to Britain's The Observer newspaper, Glencore and Mopani both rejected the report and claimed that the audit had missed significant cost rises such as fuel. However, there did not appear to be a response to the central claim of transfer pricing. Mopani is said to have saved up to 76m pounds sterling a year in taxes, or about US$120m. The GDP of Zambia last year was only US$12.8b. Glencore, which is about to list on the London and Hong Kong stock exchanges, is one of the world's biggest tax dodgers and owns more than one-third of Xstrata and shares senior board members with the company. Glencore extracts huge marketing fees from Xstrata and acts as its distributor. Xstrata, like Glencore, is domiciled in Zug and pays significantly less tax than other miners operating in Australia.