An update to the figures for 2009 we have previously made available - which were supplied by ZRA (which has since been removed from their website - they no longer provide detailed copper tax revenues). According to the recent EITI report in 2009 mining companies paid the following in taxes (all figures in Million Kwacha)
Pay- As-You-Earn - 564,822
Import VAT - 298,230
Mineral Royalty Tax - 242,192
Company Income Tax - 209,721
VAT (non refundable) - 165,579
Import Duty - 114,219
Withholding Taxes - 59,010
Excise Duty - 1,113
As you can see, mining companies only paid US$60m in MINING tax. This is actually not too dismilar from the US$50m figure quoted in our monthly essay - Debunking the Government's case for low mining taxation in Zambia - which was based on ZRA figures before EITI reconciliation. All the other taxes are just general business taxes - that all businesses pay. These are not mining taxes. You can find the above table in the EITI report for 2009, page 27.
The ZRA projection for mineral royalties in 2012 following the budgetary changes is around US$360m - which though significantly higher than 2009 would still only be less than 6% of the total revenue from copper exported this year. The bottom line is that 6% is not sufficient as a revenue take from copper. It seems Government wants us to treat mining companies just like a kantemba. We are being asked to pride ourselves with job creation and PAYE. These are precious resources owned by all Zambians. Minerals are not a few vegetables you grow out of your own pocket. These are precious gifts of the Creator to Zambia as a whole. So it's about justice. Zambians getting what is our right.
The Government's position of simply relying on the 6% mineral royalty tax (with the profit variable tax effectively delivering zero for obvious reasons) on this issue is therefore not only intellectually deficient but morally reprehensible. It's therefore up to all Zambians to see that a few individuals don't deprive our country of a better future. And we can have it! There's no reason why mining companies can't make profits and people having a large share. Angola, Botswana and even little Mongolia have done it. Why not Zambia? We all must continue to speak out on this issue. Let us refuse to go down as accomplices to shameful policies that keep our people perpetually in chains of poverty.