Reuters report that some Western donors may withhold key financing for Zambia's 2010 budget due to claims the government is being soft on corruption. According to "Treasury officials" we may might be forced "to announce higher taxes in Friday's budget to try to plug a likely funding gap". If true, this would be a huge psychological blow to a government that for nearly twenty years has prided itself in donor support. Of course, this may just be an attempt to spin higher taxes ahead of the budget, conveniently using donors as scapegoats. The problem is not higher taxes per se, but where these taxes are levied and what the money is spent on. Higher mining taxes would be welcome coupled with greater spending on infrastructure. But I am not holding my breath...
Are there any excuses left not to tax the mines?
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