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Monday, 4 June 2012

A renewed push for higher mineral taxation?

Saviour Chibiya (Barclays Bank Zambia MD) recently called for an upward revision of mining tax in order for the country to generate more income from its mineral wealth:
“When these concessions were being agreed upon, mines were in a loss situation as they were heavily recapitalising but the situation is different now. There is need to generate more from our diminishing mineral wealth. In 2008 when there was a global financial crisis, mines restructured, people were declared redundant, mines were closed and the Kwacha lost value hitting K5,600 to a US dollar. But when prices rebounded, there was no change for the good of the Zambians"
The call is part of what appears a renewed momentum by many people for Government to do more to ensure a fair outcome for ordinary suffering Zambians. The Opposition appears to have not seized the opportunity in this area. Part of the problem is the discredited record of MMD, with respect to mineral taxation. But UPND's Hakainde Hichilema appears to be now turning his attention to this issue. He recently observed that the country could have realized about K4 trillion if the government had reintroduced the windfall tax for mining companies. The money collected from the mines in form of tax could have been channelled into infrastructure development in the country.

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