Zambia has lost $2bn from delayed taxation on mines, says Hichilema
Zambia has lost $2bn from delayed taxation on mines, says HichilemaBy Mutale Kapekele and Maluba Jere
Monday February 18, 2008 [03:00]
ZAMBIA has lost $2 billion dollars (K8 trillion) as a result of delayed taxation on the mines, UPND president Hakainde Hichilema has said. Hichilema said the government had been too slow in increasing taxation on the mines which resulted in the country losing out.
“Effecting taxation on the mines is long overdue. The MMD was so slow in affecting a higher tax regime and because of those delays the country has lost $2 billion dollars,” Hichilema said. “If taxes were effected at the right time, we would have accrued K8 trillion ($2 billion).”
He said the right time to have introduced the new tax regime was in 2005 when the copper prices went up.
Hichilema said the “revenue loss” was a big blow to the country as the money could have been used in poverty eradication and in other developmental activities.
“It is such failures by the MMD that are perpetuating poverty,” He said. “That money could have been used to build better bridges, to buy medicines in hospitals and clinics and other areas of need.”
He said the increment of mining taxation from 31.7 per cent to 47 per cent was not sufficient.
“Taxation on the mines should be around 50 per cent if we are to generate proper revenue, the current increment is still low,” Hichilema said. “The direct and indirect tax on the mines should be able to generate $1 billion (K4 trillion) per annum if it was pegged at 50 per cent.”
Hichilema said if the government aimed at getting $1 billion per annum, the revenue would translate into 30 per cent of the annual budget.
“Imagine raising 30 per cent of the budget just from one sector. This is more than the total donor funds that we get per year,” he said. “With such kind of money, the economy will grow by 10 per cent per annum. The MMD are flat and cannot even think about that.”
He said the mines should now just discuss with the government as to how they would pay.
Hichilema said the new tax regime should be in place by the end of March and that once implemented, revenue must be applied prudently.
Labels: DEVELOPMENT AGREEMENTS, HAKAINDE HICHILEMA, MINING CONTRACTS, UPND, WINDFALL TAX
posted by MrK @ 9:11 AM
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