Government has disclosed that extensive work has been done towards the development of an optimal fiscal and regulatory regime for the mining sector.
Finance Minster Ngandu Magande says only a few ‘final touches’ remained before the 15 member team concluded its work whose outcome would be announced in the 2008 national budget.
Mr. Magande said at a press briefing in Lusaka today that an optimal fiscal and regulatory regime once put in place would ensure that Zambians got a fair and equitable share of their resources..
He added that the regime would also enable the mining companies get an appropriate return on their investment.
The Minister stated that governments objective is to have a strong and robust mining sector with a fiscal and regulatory regime that is efficient and attractive to investors.
“With this kind of regime , I do not see any need for Development Agreements (DA) in the future because all the intents and purpose of which the investors want DA shall be provided in the framework,’; he stated.
Mr. Magande said the status of the negotiations on the mining agreements, the principal should be the case for all other sectors in the economy.
He said because of the concessions under the Development Agreements (DA) with the mining companies, contributions are not consistent with the revenues being made by the mining companies.
The Finance Minister said it is clear from their contributions that there is inequality in the sharing of revenues from the country’s major resources.
He stressed that the mining companies should contribute more to government in order to fulfil the stated purpose of the DA which are to secure the maximum benefit and adequately contribute to the advancement and social and economic welfare of the people of Zambia.
“This clearly demonstrates the lopsidedness of these agreements and under such circumstances, it is extremely difficult for the government to continue signing further Development Agreement on the same terms,” he said.
Mining companies are this year projected to earn about US$3.5 billion of which only 10 percent (US$198 million) will be paid to government in tax contributions.
Due to rising copper prices on the international market, mining companies in the last two years, earned US$1.6 billion and US$3.1 billion respectively while US$26 million and US$76 million was paid to government as taxes.
Government had appointed a team, comprising technocrats from government ministries and departments to renegotiate the Mining Development Agreements (DA) because of the stability clauses in the DA.
The teams mandate was however extended so that they could also come up with an optimal fiscal and regulatory regime for the sector for the future.
The team chaired by Secretary to the Treasury Evans Chibiliti has undertaken consultative visits which include major mining countries such as Chile.
The team had also engaged international consulting firms from Norway and the USA purely to assist them with an international perspective and best practices on the matter.
Findings by the team revealed that Zambia’s fiscal regime comparable to other mining countries has the lowest effective tax rate in the mining sector.
Zambia’s effective tax rate under the DA regime stands at 31.8 percent, while Zimbabwe was at 41.3 percent, South Africa at 43.4 percent and Angola at 53 percent.
At International level, Zambia still has the lowest effective rate followed by Peru with rate of 39.7 percent.
I will not say much until I see the content of the new tax regime. There is no need to celebrate or count the chicks before the eggs hatch. However, should we have a raw deal again just remind them of KK’s nationalisation the mines in 1969 and that that is the only option we maybe left with. You will see how quickly the mining companies will respond positively.
Why should MMD insert Mining negotiation in the 2008 national budget…its all to cover the real issues of getting a fair share from the mines!
secondly, the so called team on mining must make their findings and recommendation public and accessible.
Why is MMD so afraid of getting better deals with investors…I think we need another goverment that will act on behalf of zambians..This MMD has failed to deliver, Come on People,…let vote for a better alternative to MMD,It is dying party!!
Cheers number 2! MMD has failed to deliver period? let us infuse another wave of thinking by electing new leaders.ladies and gentlemen if you were born in the fifties and sixties ..it is now our turn to rule. The viagra or cialis generation(sata and lupiya banda) is way too greedy to step down? let us unite and put the viagra/cialis generation where it belongs (in retirement). Mwaanga is not the only one that was supposed to retire! it is now that we have to pave way for our generation.
# 2 & 3,
Americans say talk is cheap and that is what you are proving here. The New Deal has created a very conducive environment for any political dynamism. Sleeping on blogs will never actualize your dreams. Idealists or realists realign their vision among voters on the Ground. You risk being another empty chatterbox of the next 15 years. LT times or any other blog has no bearing on mechanics of politics change whatsoever.MMD welcomes any frontier you think you could give.
If this is what Chiluba meant, now he is talking and I like it. Look at the statement below and see clearly how the man implicates himself and Kaweche, the Plunder Team nchito iyo ya oneka ka! What did Kaweche do to deserve a house bought for him? This stinks!!!
“On Mrs Kaunda, Dr Chiluba challenged her to explain the payment of US $7,100 on May 8, 2000, another US $24,318 on May 23, 2000, as well as the provision of a Camry car, and a house bought for her son, Kaweche in South Africa”.
#4 (FACT)The new deal has added value to the conducive environment created by the two regimes but there is still room to improve.That is why pipo like # 2 and 3 are expressing their views.They have the right to do so, if they can afford to sleep on the blog let them do so.You will be amazed at how LT and anyother civilised blogs impacts on issues. Remember Adolf Hitler started his revolution in a bar.So dont rule out blogs creating another revolution
Dumisani ,
Mama betty was sick and the family evacuated her to London and paid much of the bills. Chiluba hoped that was the Golden opportunity to get closer to the Kaundas through family help with influence on KK to retire. Mama Betty believed it was party of their constitutional benefits which they deserve.It didn’t work. Then Chiluba staged an arms rubbery on Panji’s VX. In the act, Panji bruised the sponsored thieve and the VX got damaged. To cover up Chiluba offered replacement.
It did either work with Panji, then he switched to Kaweche to revolt against late Wezi who was too pivotal to the father’s decision. While in South Africa in the House he had just got on mortgage, Chiluba through Buchizya the Malawian born Reuter reporter based in South Africa sent in money as balance to the mortgage in hope of Kaweche influencing KK. It didn’t work either.Buchizya was even in the forefront of forcing KK to announce retirement after coming out of Mukobeko at Freedom House. .
It didn’t work either though KK realized Buchizya’s assignment though watching him closely. Finally Chiluba’s option was the end of Wezi. And then Chapi the PF shushushu says he is being victimized. When Mama Betty reflects at the suffering at the hands of that sadists, Chiluba calls her a satanist who is after denting his perfect name.
I remind Chapi and his fellow bootlickers that good luck this time around.
FACT where did you get that info from. Do you have the FACTS for sure?
I think in politics no one is clean. No matter how honest you may be. In the end you tend to mess up especially in African politics. Very few people like Nelson Mandela have left a good legacy. The problem is our leaders dont learn from past leaders. I hope Ba Levy will be different from the others.
# 10,
Go ask KK, Dr. Waza and some closest aides still alive and well for authentication if any of my statement here is faulted.Silence is not stupidity. We know a lot about Chiluba above and beyond the public domain. We can assure Zambians, Dr. Mwanawasa is the best thing that has happened to Zed after that abortive third term. The questioning and challenges of who was selling our Copper led to the manipulation of the constitution and eventual statelessness of our founding father.
What we have is overwhelming and more than enough to give Dr.Mwanawasa a total break from creating a cardiac arrest for Chapi’s uncle Chiluba. I want him to get ready because the files are ready for him to answer at home and before world courts. Remember that many are the times he worked against the UN sanctions in the DRC with Savimbi to kill thousands of lives. He should have gone with Savimbi.
It all makes sense,considering the length to which Chiluba went to corrupt people with brown envelopes, I can easily understand how he would buy a house for Kaweche for him to prevail over the father to retire. That pigymy from Ituri was such a satanist. No wonder all his close friends went by devil or ghostly names e.g. Kalumba, Chibanda, Sata. You have to be lost big time (Chiluba) to sorround oneself by such devious creatures of the night and Kuluma’s diappearing antics’re a testament to this
LPM z not the best thing that has happened to Zambia after FTJ thwarted 3rd term FACT.
I hope Magande z doing fine job over our mines,lets wait & see
Zed has moved in the right direction wit min tax frameworks.I have no time listening to FTJ telling us about his bribes to KK n family after killing one of them.Thats bull period.Lets talk about dev issues Zambia faces at present.Thats what puts bread on the table of our fellow zeds at home.How, when n where the milk FTJ spelt is Task Force’s breakfast.And bigups to Zambians in the disspora remitting over $200 million home, well done guys lets invest home thats the way to go, I’m inspired by you
So its true there is transfer of business from ZSIC and ZANACO to a others owned by one individual, hey? The 2 Ministers have agreed and refused at the same time. In terms of insurance I have dealt with both named insurers and I have found that ZSIC is more competitive when it comes to premium rates and indemnity. I dont think there was anything correct about the decision. No wonder most if not all govt deals are going through the same guy. Grossing over issues won’t help. Can MMD answer pls!
Chiluba calling Mama Betty Kaunda a “Satanist” for reflecting on his sadistic behavior during his tenure in statehouse confirms Pikinini is a pervert. He goes on to say he bought Col. Panji Kaunda a VX Land cruiser, forgetting that he mobilized thugs to steal his VX at Gun point on the way to eastern province. Does a criminal’s restitution in or out of court settlement to the victim mount to a gift?
Any victim deserves recovery of his loss at the hands of any crime actors.