Sunday, July 01, 2007
By Joan Chirwa
Wednesday June 27, 2007 [04:00]
A MEMBER of the Wildlife and Environmental Conservation Society of Zambia (WECSZ) has supported suggestions made to the government on the introduction of an environmental tax on mining companies in the country. Muliokela Kalaluka, however, said stakeholders should investigate the actual implication of having such kind of a tax imposed on mining companies.
“I agree with the issue of having an environmental tax introduced for the sake of safeguarding our environment. It is true that land being used for mining activities can never be used for something else. For example, copper mines are very huge and cannot be used for agriculture or other activities apart from mining. These areas are almost dead and very little is being done by these companies in terms of initiating environmental programmes in the communities they operate in,” Kalaluka said.
“However, a number of issues need to be looked at such as the institution which will be responsible for collecting this tax. Will it be going to the government, or it is the Environmental Council of Zambia responsible? It is also important to establish if it is the local councils or the chiefs who will be collecting this money.”
Kalaluka said it was important to have clear mechanisms before suggestions for the introduction of an environmental tax on mining companies were advanced.
“The current environmental strategic plan for Zambia is hanging and nothing much is being done to support this document,” Kalaluka noted. “It is a good idea to have the mines paying environmental taxes but there must be a serious framework of how and who will be collecting this money.”
Seedco business unit manager Max Mbunji suggested the introduction of an environmental tax on mining companies in order to compensate for the dwindling agricultural land.
Mbunji noted that a lot of land was currently taken up by mining activities.
He said that posed a serious risk to Zambia’s agricultural production.
The government is currently reviewing mineral royalty taxes for mining companies from 0.6 per cent to three per cent, with a view to increasing revenue to the treasury, but Mbunji noted that the focus should not only be on royalties but implications that mines have on the environment.
During 2006, mining companies contributed a total of K35 billion towards the government treasury in mineral taxes against profits of over a trillion kwacha.
Because of the increase in mineral profits over the last few years, stakeholders also suggested the imposition of windfall taxes on mining companies.