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ZRA needs new law to tax mines more - Sichinga

ZRA needs new law to tax mines more - Sichinga
By Ndinawe Simpelwe
Mon 13 June 2011, 17:00 CAT

THE law currently does not allow ZRA to collect more money from the mines, says Bob Sichinga. Reacting to finance minister Dr Situmbeko Musokotwane’s directive that the Zambia Revenue Authority (ZRA) should collect more money from the mines, Sichinga said currently, it was legally not possible to do so.

Sichinga said ZRA does not collect money anyhow but needed a law to allow them do so, adding that the statement by Dr Musokotwane was baseless and political.

“The question is how will the ZRA do it? Musokotwane should explain to us what he means exactly and how they plan to increase the collection because it does not make sense just to ask the ZRA to collect more money without telling us the mechanism they will use,” Sichinga said.

He said the statement by Dr Musokotwane was an indication that the government had admitted that the windfall tax was the best way to collect money from the mines.

Early last week, Dr Musokotwane directed the ZRA to collect more money from commodity trader Glencore’s Mopani Copper Mines for unpaid taxes after an audit report of Mopani leaked earlier this year revealed that the company had underpaid mining dues.

Mopani has been accused by some non-governmental organisations and other groups in an open letter signed by a group of European parliamentarians of tax evasion and of causing widespread pollution.

The European Investment Bank, the European Union’s lending institution, also froze all new loans to Glencore and its subsidiaries, citing serious concerns over the commodity trader’s governance.

Most of the claims stem from a pilot audit commissioned by Zambian tax authorities, which leaked earlier this year.

Glencore has repeatedly denied the allegations in the audit report and said they are based on an incomplete study.

Dr Musokotwane said early last week that ZRA had asked Mopani to pay more money in underpaid taxes.

But Sichinga questioned Dr Musokotwane’s consistency in dealing with the mines.
He said the same minister was in the forefront to defend Mopani when the audit report leaked out.

“Musokotwane is just trying to hoodwink us. He has now realised that the government was wrong to scrap the windfall tax. He should also tell us how much he wants the ZRA to collect from the mines,” said Sichinga.

“What did they agree on when he made that statement in Parliament last year? How does government expect to tax the profits when it is exempting the mines from paying tax for many years?”

Labels: MINING, ROBERT SICHINGA, SITUMBEKO MUSOKOTWANE, TAXATION, WINDFALL TAX, ZRA

posted by MrK @ 6:37 PM