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New mining tax regime to boost FDIs

THE newly-enacted tax regime will attract foreign direct investments (FDIs) in Zambia as it will enable the mining sector to make profits, ZCCM-Investments Holdings chief executive officer Pius Kasolo has said.
Dr Kasolo said mining firms cannot make profit if they are over-taxed and that would not work better for the industry.
The new tax regime on mineral royalties will range from four to six percent.
“Value addition tax is not cumbersome as it was before the amendment of the tax regime. Quite a number of mining companies are happy with the new Act,” he said.
Dr Kasolo said this during a discussion at Copperbelt Mining Trade Expo and Conference that attracted a number of mining suppliers from both local and international firms.
He said the mining industry has been given enough time to explore for minerals through the new law.
Dr Kasolo also said there is need to allow ownership of mines in partnership with the local community as well as by giving them a certain percentage to supply to the mining companies.
“Our neighbouring countries have been putting emphasis on the local content, even here we need Zambians to participate in the mining industry,” he said.
And PricewaterhouseCoopers Zambia senior tax manager George Chitwa said Government tried to arrive at a balanced tax regime mining houses were ‘crying’ for.
Mr Chitwa said having such a tax regime in the country will allow investment flow in the industry.
And Ministry of Mines and Minerals Development director for safety Gideon Ndalama said Government is ready to share the production cost in the mining industry.
“There is an issue of taking responsibility through sharing of the production cost through competitive tax regime,” he said.
And Chibesakunda and Company partner Chileshe Sokota said Government is ready to listen to stakeholders in the mining sector following the introduction of the new mine tax.