Maravi

MMD’s removal of windfall tax angers opposition MPs

COMMENT - This is why this whole FDI model needs to be overhauled. We need to start producing our own food and manufacture the products we consume. We can tax the mines in copper, use that money to pump up the Kwacha and than reinflate it by writing an equivalent amount of loans and cash, creating hundreds of millions of US dollars without generating one cent in inflation. That would shut up anyone who claims 'we don't have the money'. How can a country with massive mineral reserves 'not have money'? Oh I remember, because we give everything away 'for jobs'. We need to end the neocolonial mindset and the neocolonial economy to move forward NOW.

MMD’s removal of windfall tax angers opposition MPs
Written by Ernest Chanda
Thursday, March 26, 2009 6:41:08 PM

OPPOSITION members of parliament on Wednesday walked out of Parliament in protest against an amendment to the Income Tax Bill which sought to remove the windfall tax slapped on the mines last year.

After being defeated by the ruling party in an electronic vote, many Patriotic Front (PF) and United Party for National Development (UPND) parliamentarians walked out in protest against the outcome of the vote.

The Bill had reached committee stage and members of parliament were hoping that government would listen and maintain the windfall tax.

The visibly annoyed parliamentarians maintained that the MMD government was using what they termed arrogance of numbers to betray the will of the people who put them in power.

However, a combined team of 15 opposition parliamentarians stayed on as their colleagues from the Executive's side celebrated the victory. Later in an interview, Kantanshi PF member of parliament Yamfwa Mukanga said the opposition did not want to participate in betraying Zambians.

"The situation is that we don't want to be a part of the removal of the windfall tax. Windfall tax is very important. In order for this country to survive we need income. And we have been fighting in this House that we may have a lot of money donated by a few countries. Through windfall tax we can make that money because God has given us copper. We want to use our copper, we do not want to have a donor dependence syndrome to continue," Mukanga said.

"So what we thought was if the windfall tax was there we would be able to raise a lot of money. But this government seems to continue to be depending on donor funds, the goodwill of donors. It won't work, one day the donors will pull out. So today we decided not to be a part of these [windfall tax] issues. If they want to ensure that they remove that clause which allows them to collect windfall tax let them do it alone. In fact the windfall tax as it is in the law it is supposed to be triggered when copper prices reach $5, 112 per tonne. The second trigger point is in the range of $6, 600, the third trigger point is in the range of $6,700. So this is still way up the current copper price.

"That's why we are not happy that the windfall tax can just be abolished like that, NO. We are losing out, we are not helping the Zambians. Zambians will continue to suffer with a government like this. That's why the people out there should be able to see who is with them and who is against them. With this type of understanding we will always have problems, that's why we decided, no let's walk out, we don't want to be part of it."

And his Lubansenshi PF counterpart Lazarous Chota said there was no need to remove the windfall tax because it was self adjusting.

"Windfall tax is self adjusting. If the price of copper is up it [windfall tax] will adjust itself. If the price of copper is down the windfall tax will adjust itself. So if it [copper price] is very down it [windfall tax] will adjust itself. So if it's very down they [miners] won't pay any tax, windfall tax, they won't. So it [windfall tax] becomes dormant and we suspend it. As I'm talking to you now the price of copper at the London Metal Exchange is $4, 119. So they [miners] are in profit already," Chota said.

"So, that's why we are saying look, leave the windfall tax in our statute books. In any case they [government] brought this tax only last year, only last year a few months ago. The late president [Levy Mwanawasa] brought this and all of them were shouting, they were happy.

"Are they changing this law for one man? We know all this they are changing this law for one person who is coming from Nigeria. This is what we are talking about, this person who is coming from Nigeria may be is coming to produce whatever, cement and then... they are changing this law for one man and killing all the Zambians. We are saying No. Please we are begging them, we are begging them," pleaded Chota.

Meanwhile, Roan PF member of parliament Chishimba Kambwili said those who were bent on removing the windfall tax were as good as a mortuary attendant.

"Whoever wants to remove the windfall tax is just a malukula [mortuary attendant]. A malukula is, in a child's mind, where the child thinks when you die and you wake up in the mortuary the mortuary attendant will kill you. This is exactly what they [government] are doing," said Kambwili.

"And posterity will judge them very harshly because they are taking away money for education, talking away money for health and giving it to the foreigners. Like what has happened at Luanshya, LCM [Luanshya Copper Mines] has pulled out without paying windfall tax. They want now everybody not to pay windfall tax. We cannot accept that nonsense."

Efforts to get comments from UPND parliamentarians proved futile as they refused to talk.

Labels: CHISHIMBA KAMBWILI, CORRUPTION, FDI, LAZARUS CHOTA, MMD, NEOCOLONIALISM, PARLIAMENT, WINDFALL TAX, YAMFWA MUKANGA

posted by MrK @ 6:40 PM