Maravi

Miyanda urges govt to stop daring mining firms

Miyanda urges govt to stop daring mining firms
By Brighton Phiri
Wednesday March 05, 2008 [03:00]

HERITAGE Party president Brigadier General Godfrey Miyanda yesterday asked government to stop challenging the mining companies to go to court over the new mineral tax regime. Commenting on the on-going stand off between the government and the mining companies over the new mineral tax regime, Brig. Gen. Miyanda said it was dangerous for government to rely upon the court to defend its position over the new tax regime.

"Government must desist from using threats of going to court because nobody knows the outcome of the matter that is taken to court," he said. "We can't know who is going to win between government and the mining companies. So far government has lost cases that has cost the country a lot of money such as the Vulture Funds case in London."

Brig Gen Miyanda asked the mining companies to pay what was due to Zambians instead of being stubborn. Brig Gen Miyanda, however, accused government of having contributed to the impasse due to their delay in introducing the mineral taxes.

"I do not support the stand taken by the mining companies but government ought to have taken this matter at least three years ago. It is not good management to introduce taxes on the eve of the budget speech," he said.

He said government had a greater share of the blame over the tax impasse due the manner in which they were playing hide and seek with the mining companies.
Brig. Gen. Miyanda said government could have been mindful of the fact that the mining companies had been implementing their strategies and business plans over the period of seven years during which they enjoyed tax relief.

"To spring up this tax in the 2008 budget, it seems to me that it was an after thought by government. If this had been a well thought out government plan and strategy, it ought to have been introduced for public debate about three years ago to cushion the transition," he said. "Although I don't support the mining companies' stubbornness in refusing to share in the huge profits that they have raked in, I say they have valid grounds for complaining because they have been implementing their strategic business plans based on the past government pronouncements."

He accused the government of being inconsistent and that they often contradicted themselves on their major policy pronouncements.
Brig Gen Miyanda said it was important for government to be predictable to avoid creating uncertainty and instability in the economy.

"There is no need for government to be shy or apologetic when it has made a correct policy statement which seem to ruffle feathers, but to back track in the face of the counter attack of the investors is the sure sign of timidity which eventually undermine the government because the other side becomes aware that government is not sure of itself hence applies pressure," he said. "Lest I may be misunderstood, I agree with President Mwanawasa's statement on his arrival from Madagascar when he said and I quote...at the beginning of my administration I said where there is a conflict between the people of Zambia and something else, the interest of Zambians will be paramount.

I support this without qualification. But criticism is on the inconsistence on the pronouncements. One moment government says the tax regime is non negotiable and the next moment the invite the mining companies for a meeting to come and explain. Just a little pressure from the investors and donors, government gets intimidated and shifts from its resoluteness."

Labels: GENERAL MIYANDA, WINDFALL TAX

posted by MrK @ 3:56 AM