Chamber of Mines slams proposed tax measures
THE proposed tax changes to the mining sector announced in the 2019 national budget will make Zambia un-investable and hurt the economy, the Zambia Chamber of Mines has warned.
Chamber president, Nathan Chishimba said that more tax instability, massive increases and novel taxes would hurt the mining industry and those who rely on its success. Mr Chishimba reiterated that attracting investment was the only way to grow the country's economy and that the base of taxpayers was Zambia's route to a prosperous future. He complained that a ten point plan that would have doubled copper production and increase the revenue base of the country which the chamber had presented to government was ignored. Mr Chishimba said that the measures that government had introduced would have the opposite effects instead. He pointed out that a number of operations would be pushed into a loss making position and would have to scale back. Mr Chishimba warned that putting mining companies in a loss making position would have devastating outcomes. "2019 budget will break the back of Zambia's economy. Proposed tax changes will make Zambia un- investable. Having met as an industry, we are convinced that attracting investment is the only way to grow our economy. We had presented a 10 point plan to government in July which we believe could double the size of copper production and add a billion dollars a year to the economy , unfortunately was ignored," he said. Mr Chishimba claimed that the introduced higher tax rates would still not lead to higher revenue for government but the opposite. He explained that as the industry production shrunk, there would be less jobs, less taxes and therefore less income for government. "Mineral Royalty rate increases by between 25% and 67% across the different price bands, Zambia will now once again be an international outlier in the severity of its regime. Sales tax will make banks stop providing financing to miners," he said.