The Chamber of Mines in Zambia (CMZ) has backed Government’s stance not to reintroduce the windfall tax in the mining industry.
CMZ general manager Fred Bantubonse said in an interview yesterday that Vice-President George Kunda’s statement at the just-ended Copperbelt Mining, Agriculture and Commercial Show (CMACS) that the Government had no intentions of bringing back the tax was correct and commendable.
Mr Bantubonse said the windfall tax was not in the best interest of either Government or mine companies.
Zambia needs taxes that guarantee benefits for both Government and investors and not ones that choked the much-needed investment.
The introduction of the windfall taxes in 2008 proved problematic, as mining houses were expected to pay way beyond the 47 per cent effective tax rate as stipulated.
“Mining companies did some calculations and discovered they would be paying over 80 per cent and this was confirmed by an independent study by Price-Waterhouse Coopers,” he said.
No investors would realistically want to pay such rates however big their investment in the mines.
Mr Bantubonse said despite having the tax withdrawn soon after being put into effect, there still remained the variable tax, which was introduced at the same time.
“So in a way, we still have windfall tax in effect because the variable tax is still in place,” he said.
[pullquote]“Mining companies did some calculations and discovered they would be paying over 80 per cent and this was confirmed by an independent study by Price-Waterhouse Coopers,” he said.[/pullquote]
There was a fear that taxing mines based on the profits they made could scare away investment.
“For any tax to be acceptable, it must allow investment to grow and business to be sustained,” he said.
Mr Bantubonse said only then could companies pay taxes, provide jobs and ensure that it was a win-win situation for both country and investors.
[ Times of Zambia ]
what is windfall tax.please help me
# 1 BMC ,in laymans words “it the tax paid on excess unforseeable profits,no one knew the copper prices will go up so high ( the price was unpredictable) hence the need to charge more tax on the profits that they have made on the $8,000 / tonne super price.
Hope youve got the point.
IN BEMBA :umwela-ukupona-umusonko(wind-fall-tax) niulya umusonko ubuteko bulipilisha ngachakweba ukuti akampani(company) nangula utwampani twapanga ulupiya ulwingi nganshi.Ngefi chili pali nomba,utwampani twa mukuba(copper mining companys) tulesanga ubunonshi ubukulu ngatwashitisha umukuba pamulandu wakweba ati umutengo naukwela ukufika ku mintapendwa cine konse-konse mumutundu wa TOOOLA ($8,000)
# 1 BMC
IN NYANJA : mpepo-yokugwa-malipilo(wind-fall-tax) ndiye yaja malipilo …………sorry am a bemba I dont know this language for MICE EATING chaps!
what do you expect? turkeys dont vote for christmas
iwe Fred Bantuballs ,just shut up ,you are just a beneficiary of a brown envlope aswell.
Can someone explain what is wrong with windfall tax. What has been said here is that beyond a certain selling price for a commodity, the tax payable is higher. What is the difference between this and the different bands for PAYE tax where beyond a certain pay, the tax is higher than that for lower pay.
Ignorance is our worst enemy. The windfall tax as it was enacted was on revenues. It was scraped because it did not take into account expenditure on investment by mine owners. The Government still has a windfall tax but it is a tax on profits, that is why it called Variable Profit Tax. The tax is charged upon deduction of investment expenditure.
I think Bantubonse doesnt serve the Zambian interest.Is this not the same chap whose wife and Children are in the UK where they are working while he is busy here making money dubiously?.This chap will make his money and one day will leave to go and join the wife outside Zambia,and we shall remain languishing on poverty.He is a traitor,and in West Africa,a traitor is burnt to death,how about here in Zambia?.
#3 You are such a h.opeless individual – almost destroyed my ribs — I understand why you spend most of your time in the air!!!