Revised mining tax regime effective July

GOVERNMENT has proposed several changes to the 2015 mining tax regime that will see the tax rate on open cast mining and underground mining pegged at nine percent while corporate income tax on income earned from mining operations has been revised to 30 percent.

The proposals, that will only take effect on 1st July 2015, will result into K2.3 billion projected annual revenue loss to Government from the mining sector but the loss would be mitigated by spending cuts in some sectors.

Briefing the media at State House after a Cabinet meeting yesterday, acting chief Government spokesperson Vincent Mwale said Government had proposed to stiffen penalties for tax offenders.

He said the Zambia Revenue Authority (ZRA) would soon introduce stringent enforcement mechanisms to effectively monitor mining activities to ensure greater transparency among mining companies when reporting revenue and expenditure.

Mr Mwale, who was flanked by presidential press aide Amos Chanda, said Government had proposed that variable profit tax on income earned from mining operation should be five percent when the taxable income exceeded eight percent at the gross sales.

He stated that Government had proposed that deduction of tax losses carried forward would now be limited to 50 percent of taxable profits.

“Cabinet deliberated on the proposals to revise the 2015 taxation regime for the mining sector and has approved that the mineral royalty tax rate for open cast mining and underground mining operation should be pegged at nine percent. The impact of the revised mining taxation regime would be great and it is projected that there shall be K2.3 billion annual revenue loss. Government has also proposed that penalties on tax offences should be stiffened and the Zambia Revenue Authority will introduce stringent enforcement mechanism to effectively monitor mining activities to ensure greater transparency among mining companies when reporting revenue and expenditure,” Mr Mwale said

He explai                           ned that once the proposed Bill on the revised mining tax regime was approved by Parliament, the effective implementation of the revised mineral royalty tax regime would be 1st July, 2015 so that there was a logical sequence in the merging two mining tax regimes in one fiscal year.

Mr Mwale said in order to implement the decision, Government would rapidly undertake administrative and legislative measures, stressing that the approved mining taxation regime would bring about stability, predictability, consistency and transparency in the mining sector.

He stated that Government was planning to link mining taxation to the Medium Term Expenditure with the aim of ensuring greater stability in the mining sector. Meanwhile, Mr Mwale said the welfare of Zambian nationals living in South Africa and travelling to that country are safe and that reports that some Zambians had fallen victim to the spate of xenophobic attacks were not true.

Mr Mwale said no Zambian living in South Africa had fallen victim of the xenophobic attacks and assured the nation that the welfare and safety of Zambian citizens in South African had remained Government’s top priority.

He said the Zambian Mission in Pretoria had been tasked to continue maintaining vigil on the state of affairs in South Africa.

Mr Mwale said the xenophobic attacks on foreign nationals in South Africa was causing a lot of concern to all members of the Southern African Development Community (SADC) and Africa as a whole.

Categorized | Home News

Comments are closed.

Our Sponsor

Jevic Japanese Auto Inspections

Social Widgets powered by