Ministry of Labour Permanent Secretary Barnaby Mulenga
Ministry of Labour Permanent Secretary Barnaby Mulenga

Government has reiterated its resolve to ensure that jobs of Zambians at Kalumbila and Kansanshi mines in North-western Province are protected at all costs.

Ministry of Labour Permanent Secretary Barnaby Mulenga says this is why government has constituted an inter-ministerial committee to investigate the alleged job cuts at the two mines following the new tax regime contained in the 2019 national budget.

Mr. Mulenga says the team has since Monday been having meetings with Kansanshi and Kalumbila mines in Solwezi and Kalumbila districts respectively.

He told media in Solwezi that the team wanted to get justification from the mines on their proposed job cuts, by proving that the new taxes will have a negative economic impact on their operations.

He has since appealed to the workers at the two mines to remain calm as government holds meetings with their employers.

Kansanshi and Kalumbila mines have proposed to lay-off a total of over 5,700 workers saying the newly introduced mineral royalty and sales tax among others will affect their operations.

And Mines Minister Richard Musukwa has said that the audit will enable government to verify the claims mining companies are advancing in view of the changes to the mine tax regime.

Mr. Musukwa however said government is waiting for the mines to also submit a technical report which is aligned to the tax measures that will be implemented in 2019.

And speaking in a separate interview, Labour Minister Joyce Simukoko said as soon as the committee concludes the audit, Government will determine the next course of action.

Meanwhile, the Zambia Congress of Trade Unions (ZCTU) has called for a serious audit of mining firms to ascertain whether indeed they will make losses in view of the new mine tax regime.

ZCTU Secretary General Cosmas Mukuka said that if this forensic audit confirms that mines will indeed make losses, a meeting between government, the mines and workers’ unions should be convened.

Mr. Mukuka said that his union is opposed to the threats being made by the mining firms that they will downscale production and cut down on the workforce in view of the new tax regime.

Mr. Mukuka said that by threatening to cut down on the workforce, mining firms have failed to recognize labor as factor in production.

The ZCTU Secretary General stated that his union is disheartened that the mining firms seem to be more interested in making profits than the labour that makes production possible, adding that this is the kind of attitude that should not be tolerated in Zambia.

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31 COMMENTS

  1. Zambia the Banana Republic begging the mines not to cause job cuts. Why does our government have to sink so low ,even asking for ‘justification’ when we are a sovereign state. PF government officials should learn to put the foot down.

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    • What foot can you put down? These are their Companies. If they don’t like your tax, they pull out. What will you do when you can’t run your own mines, even our emerald industry is controlled by a Senegalese who don’t even have mines where they come from, yet we have had mines before we were born. We can’t learn. We can’t progress. What is wrong with us? All we know is to fight each other. What a wasted lot!

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    • kalumbila and kansanshi are private companies which you have no power over….

      Kansanshi and Kalumbila mines have proposed to lay-off a total of over 5,700 workers saying the newly introduced mineral royalty and sales tax among others will affect their operations.
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      youshould have done an audit before implementing the tax regime.5,700 is a big number.

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  2. everything is not making sense in our country.. first increase in fuel price, second introducing pf fees on hospitals, increase in tax.. where is all the money tht they had to borrow and turn our country into a devastated state..now all the mines are planning to prune some workers and where do you expect them to work..if you hav failed to rule better u just quit than making people suffer in the country…God will punish you…u aren’t a good leader thts the reason why even tht dove failed to fly on your ceremony the time u entered the office…tht was a sign tht u were not wealthy to rule the country…no development in the country..the poor are getting poorer and you the rich are getting rich…I wish u would hav been studying the word.. too many Chinese in our country..they are even…

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  3. I would like Zambia to get a fair share so is the mines. I find it hard to believe, according to former CEO of FQM, Mr. Pascal mentioned that there are government representatives inclusive the permanent secretary of the mines on FQM; What is it that Mr. Mulenga and other Government officials who sit on FQM management and investors meetings going to investigate on job cuts when they are suppose to know 100% the position of the mine operation in relation to 2019 royal and sales tax implication. If that was the position the government could have made once a better decision which could not be changed. I could be wrong, I think the Ministries of the Mines, Finance and Labor do not work together to facilitate Ministry of Finance to produce a sound budget.

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    • Even ZCCM-IH is a shareholder in FQM and it being the successor to Zambia Consolidated Copper Mines(ZCCM) should have the know how and challenge their partners in mining and give Govt correct positions.

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  4. Preventing private enterprises from adjusting their labour requirements in response to economic conditions or government policy, is a dangerous step. It sends the message to potential investors that “if you come and invest in Zambia you’ll have no say in how your company is run – the authoritarian government will run it for you”.

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    • So you want our govt to continue subsidizing the mines through VAT refunds. Individuals pay VAT without claiming it back from the govt. Why should they cry to pay a sales tax of 3%? They are just too greedy. They can pack and go, we’ve alot of interested corporations

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  5. I like this, now the mines will give us details of the impact of the tax measures on their operations. They don’t normally share that with you. They have rejected the whole package of taxes including the less harmful and the harmless ones. For example, why would a mine raise an issue with paying a higher tax when the price of copper is greater than $7,500? Pure greed!

    Relax Zambians, these mines are not about to abandon Zambia, not any time soon, as Trib.al Hacks wants us to believe in his alarmist, trib.al, petty dog kind of way. They will come to the table, as surely as the sun sets to the west!!

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    • You don’t have to be HH or whatever political opponent to see a wrong in the way we’re handling our national issues.

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    • The price of copper is not even above $6,000 as at today 13.01.19. But that aside, what is the average cost per tonne for the production of copper in Zambia?

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    • @ daissy
      This is the best move our previous govts have been ignoring.

      So you want our govt to continue subsidizing the mines through VAT refunds. Individuals pay VAT without claiming it back from the govt. Why should they cry to pay a sales tax of 3%? They are just too greedy. They can pack and go, we’ve alot of interested corporations

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  6. Government will do well to waste no more time and resources trying to accomodate the mining companies with their attempts to dilute the new tax measures. This is a situation of take or leave: when national interest and investors interest collide, national interest comes first – simple as that.

    With forecasts showing copper demand/prices rising more and more, if one investor leaves, there’s already another (most probably Chinese) waiting to take over, so Zambians really have nothing to worry about. We have the handle and they hold the blade this time.

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  7. if government is back trucking on new taxes ,please let as leave these mines to our children they may have right solutions .in future our children will be more intelligent than us

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  8. Sales tax,much as we want it,has little information attached to it for the public to make an informed decision.All people know is that it was abolished in Chiluba regime,to be precise on 1July 1995. People and corporate entity want to know the rate at which it will be levied. VAT administration was straight forward and comprehensive. If it is a better way of preventing revenue leakages and tax evasion,then it is a good method of administering our tax regime. I believe the sales tax should also prevent unnecessary refunds which came up with in the VAT system. The government used to pay alone of VAT refunds to corporate entities which should be dispensed with in the Sales Tax administration. But the public would like to know the rate at which this Sales Tax will be levied.

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    • Definitely not more 5%. should the mines cry like this really? Why ain’t other industries crying like this?

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  9. #9 mbaluso, that is correct and that is the mines should be asking, as much as we citizens want to know too.
    In my simple mind, the VAT introduced tax loop holes where the mines were perpertually claiming refunds for everything that is not easy to check. Together with tax breaks they went away to their shareholders smiling all the time. Sales is easier and straight forward.

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  10. Tax is not negotiable. Everyone pays with no refund and so should the mines.

    Unbelievable there is even a slither of support to the mines when a poor woman whose tomatoes have all rot still pays tax in order to hold the stand. It just has to be true that those politicians and other Zambians who even think there is an excuse for exploiting natural resources and enjoying the peace and infrastructure in Zambia without paying standard taxes which everyone else pays are sellouts of foreign interests. Good luck at the ballot in by-elections and 2021.

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  11. In view of Transition from fossil fuel to Electric vehicles there is significant interest global In Zambians mining metals especially copper Zinc Manganese Cobalt and Nickel

    The Zambian Government should hold firm and stick to Sales tax In view of the increased demand for metals needed in the 300 Billion USD market posied in the Chinese market we expect more jobs and revenues and profits for mines like FQM

    Its not surprising that there also renewed interest in nitrogen chemicals in kafue as a value to the electric vehicles movement

    Sales tax is the way to share in the new market presented

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  12. Image the 300 Billion USD Investments in Ev Vehicles bigger than the entire economy of egypt or copper producing Chile

    They should have a balanced and ESGs and appreciate the reception they have been given by Zambians who should share in the 300 BILLION USD EV MARKET

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  13. Let the mines talk sense and we shall talk too. They want to make us believe that all the employment they have created is a favour to us? No way sir, they would not employ an extra miner if they can make their money without doing so.

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  14. The government should have had the gumption to ensure its citizens are empowered to run the mines. For how long are the foreign investors continue to run these strategic industries? The government should also negotiate more favourable shareholding in the mines, not the present split that leaves the government a miserly minority shareholder.

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  15. A Filipino expatriate in Kansanshi mocked the labor officials that all it takes is for them to be given a Chicken and they approved his application to work in Zambia.
    He holds a Diploma in Electrical engineering and gets over K100, 000.00. There are dozens of such foreigners at each mine site in Zambia doing jobs locals can do. The whole mining industry in this country is a fraud and Zambians are privy to such ……. but the powers that be either have been duped or are blind.

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  16. @ mbaluso
    You say “I believe the sales tax should also prevent unnecessary refunds which came up with in the VAT system”.

    Deduction of expenses is governed by tax legislation. Therefore, any expenditure which is wholly, and exclusively for business purposes is deductible. So, the refunds were not unnecessary as you claim.It is just PF Government which is unnecessary and not fit for purpose to deal with VAT.

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