Reforms undertaken to improve the tax regime in Zambia’s mining sector have not yielded positive results, a local think-tank said on Wednesday.
The Center for Trade Policy and Development (CTPD) said despite Zambia reforming the mining fiscal regime four times in the past five years, deficiencies still exist in the current tax structure.
Webby Banda, the think-tank’s senior researcher in charge of extractives, said a mining fiscal regime should obtain a balance between raising revenue and providing fiscal space for mining companies to continue operating.
He said a mining fiscal regime should also inspire confidence that the country was collecting what it was owed.
According to him although the current fiscal regimes was aimed at capturing maximum revenue for the country, this was not the case.
He noted that the lack of an excessive profit tax instrument in the current tax regime does not inspire confidence that the country will collect what was due or owe.
“A robust fiscal regime should capture windfall gains in high price cycles but at the same time provide fiscal relief for mining companies to continue in operation in low price cycles,” he said. Enditem