Maravi

(NEWZIMBABWE) Minerals not benefiting country: govt

Minerals not benefiting country: govt
by Business Reporter
19/07/2010 00:00:00

ZIMBABWE’S reputed mineral wealth is not making any significant contribution to national revenues compared to other countries in the region, treasury officials have said.

The country is said to sit on the third largest holdings of platinum in the world after South Africa and Russia with the leading producers, Anglo Platinum and Impala Platinum having since set up shop there. In addition the Zimbabwe also exports gold, nickel, chrome and diamonds.

Although mining was among the sectors worst affected by the economic crisis experienced over the last decade, industry executives say recovery is on course.

Turnover from the sector topped about US$1 billion last year but treasury officials say very little of this found its way into the national fiscus.

“Whereas turnover of the mining sector was close to US$1 billion in 2009, a paltry US$44.8 million which includes corporate tax, VAT, PAYE and royalties was contributed to the fiscus,” the ministry of finance said last week.

The ministry said it was proposing a raft of measures aimed a to ensuring the country benefits “from the exploitation of its non-renewable natural resources.”

Some of the measures include an upwards review of royalty payments from the current 3.5 percent to 4 percent with effect from August 2010.

The ministry is also concerned about the lack of value addition in the sector and cited the continued exportation of chrome ore.

Government introduced an export tax on chrome ore but producers simply resorted to crushing the ore to avoid the tax.

Finance ministry officials say they plan to ban the export of semi-processed chrome ore as well as raise the export tax to 20 percent from the current 15 percent.

“Minerals are an irreplaceable wasting resource, hence, there is need to maximise tax revenue from mineral extraction and also encourage investment,” the ministry said.

Labels: MINING

posted by MrK @ 10:29 AM