Konkola Copper Mines (KCM) has asked the government for time to pay back an overdue KR136.8 million or US$25.8 million debt it owes the Zambia Revenue Authority (ZRA).
Zambia Daily Mail investigations have established that the Vedanta-owned company has held “high-level” talks to discuss the unbundling of the debt amounting to about US$25 million, according to documentation in possession of the newspaper.
The US$25 million debt was first discovered after a standard routine ZRA probe which commenced in April, according to documents.
“The ZRA carries out systematic announced probes in various companies, regardless of their ownership,” a source said. “It appears it is at this stage that they [ZRA] discovered the debt which then stood at about K33 billion which has now risen after penalties.”
According to Daily Mail investigations, the mining company has asked the government to give it “time to pay”, citing high costs of production in the industry even as copper prices remain buoyant.
The three months price of copper in London yesterday stood at US$7,450 per tonne after starting at about US$7,931 at the beginning of the year, which is still way above the forecast five-year price of US$7,250.
The revelation of the debt comes shortly after the company announced that it planned to cut some 2,000 jobs but later reversed the decision after discussions with the government.
KCM’s parent company – Vedanta – is valued at more than US$5.3 billion in London and its production costs rose by 8 percent to US$5,621 per tonne, as the price promises to rise in the coming years to about US$8,000 per tonne.
Commerce and Trade Deputy Minister Miles Sampa described the KCM debt as sad, given the fact that studies show that several multinational companies in Zambia are costing the country billions of dollars annually through tax avoidance or profit transfers.
“It’s very sad that we earn very little from our mineral exports and the little money we are supposed to earn is either delayed or not even collected at all,” Mr Sampa said. “We must swiftly plug this tax avoidance hole.”
KCM public relations manager Joy Sata promised to respond after a query on Tuesday.Vedanta bought KCM 10 years ago at about US$25 million when copper prices were low and the cost of production was high, making mining unprofitable and mining assets cheap.
[Zambia Daily Mail]
Balashupa ba KCM, even Napsa they don’t pay.. Govt watch out for these tell tell signs……..
Saiko matanism please note that all KCM employees do not contribute to NAPSA.
When anglo was taking over the Assets under KCM now from ZCCM, they negotiated
not to pay NAPSA. The reasons they gave are that they do not want to put Cash into an institution that they do not trust. They further said they will setup a another Pension scheme for its employees and this has been achieved. They are actually paying more than they are supposed to pay to NAPSA. On this issue leave them alone. For your information they contribute to a Scheme managed by African Life.
I am sure the Govt is aware that they do not pay to NAPSA.
I forgive your ignorance, are u telling me that NAPSA is not reliable??? Plz think Again!! Napsa contribution is a statutory obligation and the pension scheme that is being managed by African Life is an option that KCM can undertake..If u really an employee of KCM, then you have just exposed them….
So, this $25m is part of Government Revenue which made Govt coffers to run almost dry. This forced the Govt to remove subsidies so that the suffering of poor people could cushion the the absent projected Revenue $25m.
If I was a miner with KCM I would go on voluntary separation coz the signs are not good for thr future of the company. Please choose money and not a box. Friendly advice. Another Binani is looming. Be warned.
How much debt do they owe ZESCO. “STEALING FROM AFRICA”
And these are the donkeys who are trying to lay off our brothers and sisters when they are operating on inkongole!!! Very pathetic.
These are the swines who come and claim that our leaders are corrupt yet it is them stealing our money. Stealing from the poor. sssshh.
When someone smells the dollar, this topic will go to the dust bin. Just wait.
@Treetop, it has already gone to the dustbin. The 200 workers will be retained in exchange for writing off the $25.8 mtax bill.
Is it a coincidence that kcm indebtedness is discovered just after kcm announced plans to lay off workers. Do I hear blackmail
Yes! But here is the sequence of events. ZRA presents KCM with a tax bill of $25.8 bn. Then KCM says we cant pay because of depressed copper prices. And proceeds to announce that they will lay off 2000 workers. PF blinks and opens discussions with government. KCM demands that the tax bill be written off in return for keeping in employment the 2000 workers! Zambians you’ve been sucker punched again!
No wonder FTJ had designer’s clothes maybe including his pants. “COPPER” It has made some folks in Switzerland to be RICH BOYS because of KCM Zambia while Pollution is killing innocent children and women. Pollution are far over recommendations. Who can talk only the Dollar. No wonder there are names like Dora from Eastern Province.
Just watch this space, now that they have agreed to retain the 2000 employes on face value, the next will be sackings over funny cases. MUZ must sit up. Many may loose jobs through being fired. Oooooh the tax burden they carry these investors! Why do you let them accrue so much tax debt to govt. In KK’s time we had political attache’s to mining companies and they collected figures on production, waste rock, concentrates, smelted copper, refined copper and on slurry ( which has high level of Gold, etc). They even collected figures on sales, costs and profits. KK was also clever. Do not let let off the hook. Let them make genuine profits and pay taxes due to govt. Its not long ago they caused mayhem at TAZARA due to none payment of transportation costs. Monitor them closely!
Indians want to pay NOTHING!! that is their nature. Government was dupped. These Indians know exactly how to make gvt dance to their music…’fire 2000 miners and gvt will jump’. Indeed gvt jumped. Next Tell gvt ‘if u dont want me to fire your people, tell ZRA to leave me alone’ gvt then picks up phone and tells ZRA Commissioner General to defer tax collection. Next is mine is closed and Zambia loses out. DULO Government!!
How much dollars is Mmembe owing zra and DBZ?
This indians are thieves. They dont want to pay tax but to reap maximum profits from the $25 million investment they put in. Ohh how dalo you are Zambians. These guys are reaping more than they expected. Please check them tight.
Peace and Prosperity to mother Zambia.