Miners wander through regulatory maze
ZIMBABWEAN miners, who are have to contend with at least 16 different laws regulating the sector, are pushing Government to harmonise legislation to cut unnecessary expenses and improve the business environment.
For mining houses to operate lawfully, they have to comply with the Mines and Minerals Act (Chapter 21:05); the Explosives Regulations; Mining (General) Regulations; Mining (Managements and Safety) Regulations; Mining (Health and Sanitation) Regulations; Mines and Minerals (Custom Milling Plants) Regulations; Gold Trade Act; Precious Stones Trade Act; Environmental Management Act; Environmental Regulations; Forestry Act; Water Act; Zimbabwe National Water Authority Act; and Base Minerals Export Control Act.
Other pieces of legislation that are not specifically targeted at mining houses but affect them include the Companies, Sales Tax, Exchange Control, Immigration, and Incomes Tax Acts among others.
The Office of the President and Cabinet is leading doing business reforms, and miners hope their sector will be addressed soon.
Chamber of Mines of Zimbabwe CEO Mr Isaac Kwesu told The Sunday Mail Business last week that consolidating laws would reduce operating costs and spur viability.
“There are quite a number of laws that affect the mining sector and we hope some of these issues will be addressed under the ease of doing business reforms being spearheaded by the Office of the President and Cabinet.
“We continue to engage Government on this issue. Government has been trying to streamline the taxes so that tax processes are unified. Government is not watching, it is doing something to that effect,” said Mr Kwesu.
The Zimbabwe Miners Federation - a grouping of over 8 000 small-scale miners - said there were “too many mining laws” governing miners.
Its CEO, Mr Wellington Takavarasha, said in addition to paying the statutory one percent royalty on gold, small-scale miners were faced increased pressure from the Zimbabwe Revenue Authority, Zimbabwe National Water Authority and rural district councils.
“So there is need for the harmonisation of mining laws so that we don’t have too many of them. We need an arm in the Ministry of Mines, some sort of a one-stop-shop, that caters for miners so that we don’t move from one office to the other.
“The tax regime cripples industry; that is why many people opt to operate in the black market where there are no taxes, but depriving Government of revenue.
“There is an assumption that there is a lot of money in mining but I have made a presentation to the RBZ showing them that it is very expensive to get a gramme of gold,” said Mr Takavarasha.
Artisanal miners want Government to develop a mining policy unique to their operations. Ghana, Africa’s second-largest gold producer after South Africa, has the Small-Scale Gold Mining Law (1989) that deals specifically with artisanal gold miners. Among other stipulations, the law reserves the sector for Ghanaians.
Mines and Mining Development Minister Mr Walter Chidhakwa and his deputy, Engineer Fred Moyo, could not be reached for comment last week.
However, a senior ministry official said it was impossible to have synchronised mining laws since different mineral groups demanded different regulations.
The official said, “This means we cannot have the same laws for the mining sector. More importantly, we cannot amend the Mines and Minerals Act to accommodate for harmonisation of mining laws as that would be tantamount to usurping the powers of other ministries and departments and there would be turf wars over revenue collection.
“But if the miners feel that the laws are too many, Parliament is there and they can exercise their rights as citizens.”
RBZ Governor Dr John Mangudya recently said it was critical to have good policy measures to attract investment.
Experts say Zimbabwe has between 13 million and 15 million tonnes of proven gold deposits, and only 800 000 tonnes have been mined.