KABANDA CHULU, Lusaka
SUSPENSION of mineral royalty tax to result in an annual loss of US$182 million is meant to encourage growth and maximisation of production in the mining industry, Minister of Finance and National Planning Situmbeko Musokotwane has said. In the 2022 budget, Government intends to attract investment and boost production in the mining sector through re-introducing the deductibility of mineral royalty for corporate income tax assessment purposes. Government also wants, in the medium term, to amend the law so that mineral royalty determination reflects a measure of both incremental and aggregate norm values. When asked why Government has pursued an International Monetary Fund (IMF) programme instead of mobilising funds from mineral royalties, Dr Musokotwane responded that concessions given to the mining industry were in the best interest of the country’s economy. “The measure has resulted in a loss of US$182 million per annum but had we maintained that tax, this amount could have come nowhere to help address the current economic challenges.
“We want to maximise production and encourage growth, and not just focusing on raising the US$182 million but we want to see the sector ramp up production,” he said. Dr Musokotwane said Government is looking at the medium and long-term objectives when providing incentives. “There will be temporal setbacks but I want to assure you that things will get better. For instance, we have set CLICK TO READ MORE