.Mwanakatwe

By JUDITH NAMUTOWE –

COMMERCE Trade and Industry Minister Margaret Mwanakatwe has urged mining companies in the country to be transparent in their operations and engage in meaningful dialogue with the Government on issues such as the revised taxing system.
Ms Mwanakatwe said Government had foregone the 30 per cent corporate tax and replaced it with a mineral royalty tax system to make the arrangement predictable and easier to administer by both the Government and investors.
Ms Mwanakatwe said this during a presentation at the African Mining Ministerial Forum at the 2015 Mining Indaba being held in Cape Town, South Africa as contained in statement issued by press secretary at Zambia’s High Commission to South Africa Nicky Shabolyo.
Ms Mwanakatwe said it was regrettable that in the history of corporate tax in Zambia, only two copper mines complied with this system and that Government was now aiming at improving mutual trust with the mining industry through the new one-tier tax system.
The mining indaba is an annual professional conference dedicated to the capitalisation of development of mining interests in Africa and said to be currently the world’s largest mining investment networking platform.
There was growing discontent in the developing world that citizens were not deriving a fair share from mineral exploitation and that this has put pressure on Governments to address the concerns.
She said the role of Government remained that of ensuring an enabling environment for the development of a vibrant and orderly mining industry which contributed to the economic development of Zambia.
“The new tax measures should be seen in this light. We are a well-meaning Government, striving to be transparent and open to dialogue. We are open for business and all well-meaning investors are welcome to Zambia,” she said.
She noted that objection to the new tax system by some players had been fuelled by the fact that it was coming at a time when copper prices had gone down recalling a few years back, when copper prices had gone as low as US$2, 500 per tonne but mining companies still remained in business.
“It will be important and fair for mining companies to look at what they are making before condemning Government’s decision to introduce the royalty tax system. However, we are open to dialogue, ready, willing and able to defer payments until such a time when the cash flow for all those who can prove that they are having genuine challenges to meet their tax obligations improves,” she said.
Mrs. Mwanakatwe also said Government had continued to dialogue with mine companies which had indicated that they had issues with the Value Added Tax (VAT) Rule 18 which regulated VAT refunds.
She said all mining houses that had complied with the rules have had their VAT refunded.
Ms Mwanakatwe also held various meetings with potential investors as well as interviews with international media organisations during which she marketed Zambia’s investment opportunities and used the chance to clarify the new mining tax system.