Mine suppliers and contractors okays budget

 Mine suppliers and contractors okays budget

THE Association of Mine Suppliers and Contractors say the changes made to the proposed 2019 budget by the Minister of Finance Margret Mwanakatwe last Friday for the mining sector is positive and progressive.

Association President Augustine Mubanga said the notable changes to the royalty tax by increasing 1.5 percent on each sliding band and the 10 per cent rate will trigger growth at US $ 7,500.

Mr Mubanga said such changes will ensure that benefits in terms of tax collection are derived and that the Zambian people will greatly benefit from their resources.

Mr Mubanga said the increase from 5-8% of cobalt MRT is not enough as Government has not changed the cobalt MRT in long time.

“A fair adjustment of 10-15% is going to ensure that maximum revenue collection is achieved. Mining firms must support the move because in the past four years Government had made sure that the mining sector was stabilized from the world economic stress of 2008, 2014 to 2015 by maintaining a stable tax regime.

“Our association hopes that mining houses will not take the increase as an excuse to deny Zambians business,” he said

And Mr Mubanga said the intention by the Finance Minister to the proposed amendment of the Mines and Minerals development Act of 2015 to parliament is a good move.

He said the reforms such as mandatory listings of the mines to the Lusaka Stock Exchange (LUSE) will provide an opportunity for Zambians to own shares and participate directly in running the mines.

Mr Mubanga however proposed that a regulated 40 per cent of procurements in the mining sector be given to the local Zambian owned supplier and contracting companies.

‘’The mining sector spend between US $ 3 to 4.5 billion annually this includes CAPEX. If the fourty percent is captured it will increase economic activities thereby increase contribution to the GDP and increase employment levels,’’ he said.

He said that mining companies have taken advantage of this gap by procuring more than eighty percent of goods and services from outside the country.

The Independent Observer


John Sakala is a Journalist yearning for independent journalism

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