ActionAid Zambia Country Director Pamela Chisanga
ActionAid Concerned with President Lungu’s Directive to Effect Changes by April 8 the to the New Mining Tax Regime
ActionAid Zambia is concerned by President Edgar Lungu’s directive to the Minister of Finance and the Minister of Mines to effect changes to the Current Mining Fiscal Regime by 8 April 2015.
Firstly we appreciate the urgency with which the president wants to resolve the impasse in the mining sector and as ActionAid we welcome his earlier directive to the ZRA to engage in dialogue with the mining companies over the VAT refunds and with the Ministry of Finance on the new mining tax regime.
We are, however, greatly concerned that this directive from the president comes in the wake of receiving submissions from individual mining companies and from the chamber of mines. The President has since proceeded to issue another directive to effect changes without any feedback from the relevant ministries on
his earlier directive.
The president has further gone on to prescribe the measures to be undertaken, which task should have been left to the relevant technical government agencies. Below are the directives issued by the president
- Maintain status quo but negotiate interim fiscal arrangements for operations that are most affected on a case-by-case basis;
- Identifying potential legal or regulatory modifications to the existing
- 2015 fiscal regime that could be readily passed and implemented;
- Defer implementation of the 2015 fiscal regime, and
- Temporary reinstate the 2014 fiscal regime as a more amicable regime is negotiated.
It is difficult to understand on what basis the President is issuing this directive. We believe this directive not only undermines the autonomy of the relevant Government agencies (Ministry of Finance, Ministry of Mines & Zambia Revenue Authority) to effectively carry out their duties but is yet another illustration of current government’s inconsistent economic and fiscal policy management. We also dare to add that such directives can only breed mistrust between the people of Zambia, Mining industry and those tasked to look after the affairs of the nation
As ActionAid we reiterate our call for transparency and accountability in the matter, and that the current situation presents an opportunity through genuine dialogue to develop a robust mining fiscal regime that will result in a win-win situation for the people of Zambia and the mining companies. This will not only solve the challenge of policy inconsistency that has gripped the sector but also lead to increased revenue collection and boost investor confidence.
President Edgar Lungu knows very well that Zambia, according to the Mbeki Report on illicit financial flows, is one of the countries with the highest levels of illicit outflows in Africa. To deal with this calls for serious leadership and the President has the responsibility to demonstrate this given his various pronouncements
on the issue. This is a matter that cannot be resolved by unresearched Presidential directives. The President endorsed the commitments of the report at the AU Heads of State Summit and it’s our hope that this commitment will be demonstrated through implementation of the recommendations and not just a ceremonial gesture.
It is essential that all companies operating in Zambia pay their fair share of taxes, which has the power to help us build a better future. Tax has the power to build schools and educate our children; the power to build roads and allow goods to travel; to provide medicines for better healthcare; the power to provide vital public services. Tax Power can help us to realise our potential. .
Pamela Chisanga, Country Director
Good observations, advise and well thought.
When are these people ever going to agree with His Excellency Edgar Chagwa Lungu?
Pamela is simply seeking attention. How sad !
The president did not just wake up and make directions without consultation which included stakeholders from the mines.
The mines have welcomed this directive. So what is the problem with this one single person, using her organisation.
Pamela did not want Lungu to take over PF. She campaigned against him. So not surprised here. That said, she is entitled to counter check, while the opposition is sleeping.
x factor
why do youthink the agree with? They will continue reportin losses even when the price of copper is high.
Pamela better just go and continue planting flowers in villages.
Maybe you enjoy that the PF ministers pulling your G-strings. Kaingu will insult you again, just same as Chikwanda did last year. You miss it?
I stand to be corrected, did he lock himself up to read those submissions without his aids and made recommendations alone?
Beautiful concerns from a beautiful Lady! You’ve got to be blind and deaf not to hear her!
Indeed one have got to be blind and deaf not to hear her!
May be the President should have dierected to close these mines in the next 12 months and save our resources for future generation. We do not need these mines now since the price of copper is determined by those selfish people in europe. These politicians should invest in agriculture and other viable sectors which can bring forex.
1. Pamela, Pamela please! The President is head of government and receives reports on all his directives to government agencies. Who told you that he has acted only on the basis of submissions from the Mines? Didn’t the President say that he has initiated dialogue between the Mines and Government? Do you want the President to be copying all his reports and information to you? Where have you been while the Zambian economy and particularly the kwacha has been in free fall, to the detriment of all Zambians who do not have the priviledge of dollar wages like yourself?
You have been used by the Past news to stir up trouble for the rest of us and both of you conveniently keep quiet when the chips are down for the rest of us and the directly affected Zambian Miners….cont’d
cont’d.
Pamela, we all understand the need for the country to get more tax revenue from the Mines, and the Mines themselves and government have both acknowledged this. But what we require is an equitable solution. The approach that you taking, dear Pamela, will kill the industry and the national economy with it, in which case even the little tax that we currently get will not be there. This has to be a win-win battle, and not the essentially greedy approach that you have adopted with the senseless collusion of the Past news whose agenda is actually political and diametrically opposite to your own noble objectives. Are you telling us that beautiful and intelligent as you are, you have allowed yourself to be blinded by the Past news?
…cont’d
Shouldn’t this decision have been made by cabinet?
@Chief Economist, your comments have left me with a sour taste in my mouth! Under the belt for you to purport Pamela recieves her pay cheque in US Dollars when you havent seen her bank statement like the Cobra told HH! Secondly it is a well known fact that the multi-nationals always want to avoid (tax avoidance is not an offence). However, she uses a critical word which is ”fair tax” not like what Google pays- zero in Ireland- for all the millions they are minting because of the tax laws!
You do not need to see a bank statement or payslip to believe that she is paid in dollars. All these heads of big NGOs are paid in dollars my friend.
What does ActionAid or Pamela know about mine taxation? My guess is NOTHING. All this is posturing by people who want to fix the mining companies yet who don’t understand the real reasons for the illegal cash flows out of Zambia. Govt needs to staff ZRA with competent people, not relatives (Mr Lungu!) and cadres. Chikwanda was trying to do taxation made simple for their cadre-filled ZRA.
Pamela should spend more time outside to get some colour back onto her bleached orange skin.
BTW, govt ministries are not independent of the President. At least some Zambians voted for Lungu. But who voted for Chikwanda? Chikwanda has to play the tune of his appointing authority, the President.
cont’d
Pamela, you must always bear in mind that we are as not powerful as America who can take on giants like BP, ours is a small, weak and vulnerable economy and the stubborn militancy postulated by Pope Mmembe for purely selfish reasons will not take us anywhere. So we must moderate our theories with practical realities, as we try our best to get the best deal for ourselves. We are not the only investment destination, there are other more attractive ones. By the way, have you sat down with the Mine unions and the Mine workers so that you get their take on these matters?
Apart from the above observations, you are doing a good job for Zambia. But so is President Lungu from a different and more critical platform!
Ok – me I supported the Chikwanda tax.
These mines are full of educated and sophisticated crooks. We will never make money from the mines as long as the mines are in the hands of these foreign companies. We need ONE TAX that they CANNOT MANIPULATE. Now giving them all the different taxes, they will be telling you about losses, poor copper price hence no money to pay tax.
Zambians we are too weak. We give up to quickly! The mining companies are not our relatives!
Well said Mwamoneni. This is one subject we should be all agreed opposition or otherwise and stop playing politics. This is why we end up with decisions that can fix our problems in the short term.
As a person among the 4,000 those who were going to lose their jobs I welcome this move by Edgar. Yes Zambia needs the money. Unless Pamela will look after me if I lose my job, lets approach this issue with caution. ABC must be removed and replaced with either Fundanga or Dr Musokotwane . Maybe even Magande
Negotiate, negotiate, negotiate. The moment Government abandons negotiations, then thr nation loses valuable and much needed revenue for national development. How about meeting half way between the old tax regime and the new tax regime in order to strike a compromise? It looks like mining companies are getting greedier and greedier rather more and more civic.
Ba PAMELA PF ALA FATHER BWALYA ALISOSA KALE NIBA CHUMBU MUSHOLOLWA,NAKABILI UMBI NAWO ASOSA ATI NIBA CHIMBWI NO PLAN. KEEP ON MADAM I PERSONALLY SEE SENSE IN WHAT YOU ARE SAYING…
Chief Economist,
You have totally missed it here. The President does not issue directives on issues of policy. The treasury is under the control of the Ministry of Finance. It is the Ministry that defends the budget. It advises on revenue-neutrality of all decisions including statutory instruments. The President, though he is head of state, does not have control over treasury matters. This is to ensure professionals make the decisions. In this case, it is clear the President has been compromised. Two years later, you will be hearing stories of how he was bribed. Presidents must be insulated from any such compromising situations where they issue directives. What will the Government agencies do now? Go to parliament and defend the decision on account of an instruction?
Mining taxation in Zambia is a mystery. Only one, Levy Patrick was able to tax the mines and get Zambian’s a fair share. But from the time RB took over the presidency, nothing has worked for Zambia. When Zambians reminded MCS about his campaign promise to re-introduce windfall taxes, Chikwanda called them mad. When ECL was taking over office, he appeared determined to implement the new tax regime. What really happens over mine taxes when politicians go to state house mwebantu? What ECL should now tell the nation is how is the revenue and expenditure sides going to be balanced with these new changes?
Iwe Ka Pamela who told that Ministries are autonomous