President Edgar Lungu has directed the ministers’ of Finance and Mines to amend the 2015 mineral royalty tax system and make fresh recommendations on the policy to Cabinet by April, 8 this year.
Mr. Lungu has asked the two ministers to consider the status quo but negotiate interim fiscal arrangements for operations that have been most affected on a case-by-case basis.
This is according to a statement released by Special Assistant to the President for Press and Public Relations, Amos Chanda.
The mineral royalty tax was this year hiked from six per cent to eight per cent for underground mines and eight per cent to 20 per cent for open cast mining operations.
“It is clear that this unfavourable economic trend globally has been mainly on account of weak global demand for copper,” Mr. Lungu said.
Mr. Lungu said after receiving submissions from individual mining companies and the Chamber of Mines, it was clear the new mining tax regime posed a challenge to some mining operations.
Mr. Lungu gave the directives in his letters to Finance Minister Alexander Chikwanda and Mines Minister Christopher Yaluma yesterday.
Mr. Lungu directed the ministers to use the current legislation and administrative procedures to ensure that mines facing severe challenges are assisted.
The President wants Mr. Chikwanda and Mr. Yaluma to identify potential legal modifications to the existing 2015 fiscal regime that could be readily passed and implemented.
Mr. Lungu suggested that the implementation of the 2015 fiscal regime could be deferred and 2014 policy temporarily reinstated as a more amicable regime is negotiated.
The Head of State said Government was amenable to progressive ideas that assist in addressing challenges in the mining sector.
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