Govt sat­is­fied with min­ing sec­tor

Chronicle (Zimbabwe) - - Business -

THE GOV­ERN­MENT is now sat­is­fied with the level of co-op­er­a­tion it is re­ceiv­ing from min­ing com­pa­nies in the craft­ing of a fis­cal regime for the sec­tor, fol­low­ing ini­tial re­sis­tance by some play­ers, a Cabi­net Min­ster has said.

The Gov­ern­ment, to­gether with its part­ners, is de­vel­op­ing a new fis­cal regime for the min­ing sec­tor which is de­signed to plug leak­ages and also to nur­ture an ef­fi­cient and pro­duc­tive tax sys­tem.

The new sys­tem was mooted fol­low­ing re­al­i­sa­tion, last year, that the ob­tain­ing tax struc­ture in the min­ing sec­tor cre­ated a host of dis­tor­tions and ad­min­is­tra­tive chal­lenges.

It also seeks to elim­i­nate du­pli­ca­tion in col­lec­tion of levies as cur­rently Lo­cal au­thor­i­ties, the Zim­babwe Rev­enue Author­ity, the En­vi­ron­men­tal Man­age­ment Agency, Min­istry of Mines and Min­ing De­vel­op­ment and the Min­er­als Mar­ket­ing Cor­po­ra­tion of Zim­babwe all have levies against the min­ing sec­tor.

An­a­lysts con­tended that the un­co­or­di­nated col­lec­tion neg­a­tively af­fects vi­a­bil­ity, trans­parency and ac­count­abil­ity of the sec­tor.

Fi­nance and Economic De­vel­op­ment Min­is­ter Pa­trick Chi­na­masa said the process to cre­ate the min­ing fis­cal regime was pro­gress­ing well.

“We have been work­ing with the Min­istry of Mines and the World Bank as con­sul­tants to come up with the min­ing fis­cal regime. At first I got re­ports that there was no co-op­er­a­tion com­ing from some of the play­ers to give us figures,” he said. Min­is­ter Chi­na­masa said the Nor­we­gian con­sul­tant which the Gov­ern­ment hired had in­ti­mated to him that min­ing houses were not forth­com­ing with the re­quired in­for­ma­tion.

He said the Nor­we­gian had de­scribed the Zim­bab­wean min­ing sec­tor as the most opaque he had ever come across.

“I am happy that co-op­er­a­tion is now be­gin­ning to flow and I want to en­cour­age you on that path.”

Min­is­ter Chi­na­masa said the Gov­ern­ment ap­pre­ci­ated that com­pa­nies, in­clud­ing min­ing houses, were in busi­ness to make prof­its, but said Trea­sury also ex­pected its fair share from those pro­ceeds while high­light­ing that the new regime would cre­ate trans­parency.

“I want you to make profit. I do not be­grudge you mak­ing a profit but I also want my fair share of that profit and in or­der for that to hap­pen a fair share to the fis­cus, a fair share to you, let the fig­ure be on the ta­ble.

‘‘Let us dis­cuss, let us ar­gue who should have what per­cent­age. I think it is a bet­ter con­ver­sa­tion that we should have and if our re­la­tion­ship is built on mis­trust, sus­pi­cions, then it means some­times we do things that will not make you make money. So it’s very im­por­tant that we have that co-op­er­a­tion.”

In 2014, Nor­way spent $1,8 mil­lion on a sim­i­lar project in Zam­bia, which re­sulted in the Zam­bia Rev­enue Author­ity get­ting $20 mil­lion more than its reg­u­lar tax col­lec­tions through spe­cial au­dits. - New Ziana.

Min­is­ter Pa­trick Chi­na­masa

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