Trial and error: now PF removes tax on raw materials

Trial and error: now PF removes tax on raw materials

Zambia has suspended a 10% export duty on exports of unprocessed metals after mining firms said they had accumulated too much stock because of limited local smelter capacity.

Finance Minister Alexander Chikwanda said in a notice dated October 4 that the suspension of the tax would take immediate effect on exports of resources such as copper, iron, cobalt and nickel.

“These regulations shall cease effect on September 30, 2014,” the notice stated.

The PF regime introduced the export tax on raw metals in November 2011 two months after winning elections due to excitement but with no thinking.
According to the PF that time, the tax was aimed at encouraging the development of local industry to add value to the economic chain in Africa’s top copper producer.

Previous government did not impose this duty because they knew the negative impact it would have.

Mooya Lumamba, acting mines permanent secretary, told Reuters on Tuesday that mining companies had asked the government to waive the tax so that they could export excess concentrates to other countries with enough smelter capacity.

Foreign mining companies operating in Zambia include Canada’s First Quantum Minerals, London-listed Vedanta Resources and Glencore.

 Budget2

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