M a r k e t N e w s

Zambia: Govt Collects K10 Billion From Mines

Posted on : Friday, 18th December 2015

Government's collection from the mining industry in 2014 increased to K9.92 billion from K8.2 billion the previous year, with Kansanshi Mining Plc contributing the largest percentage.

 
The increase of K1.72 billion represents about 21 per cent to Government's revenue.
 
This is according to the 7th Extractive Industries Transparency Initiative (EITI) report of 2014, which was launched in Lusaka on Tuesday, by Mines Minister Christopher Yaluma.
 
According to the report, the K1.72 billion was attributed to the number of companies covered in the report which increased from 30 in 2013 to 40 in 2014.
 
The analysis of Government revenues by companies' contribution indicates that five companies contributed about 70 per cent of the total revenue in 2014 with Kansanshi Mine Plc accounting for 32.96 per cent of the total revenue for the year.
 
Other companies include Mopani Copper Mines (MCM) which contributed 11.51 per cent which was followed by First Quantum Minerals (FQM) at 9.7 per cent with Konkola Copper Mines (KCM) and Kalumbila Mine contributing 8.37 and 7.58 per cent respectively.
 
The report indicates that the Income Tax increased from K1.31 billion in 2013 to K1.82 billion in 2014.
 
"Zambia Revenue Authority (ZRA) the governments' main recipient from the mining sector received about K8.641 billion representing 99.6 per cent in 2014," states the report.
 
Zambia is still dependent on mining as its major productive industry.
 
Zambia broadly conforms to the inverted pyramid pattern of macroeconomic contributions with very high contributions in some macro areas mainly exports and Government revenue.
 
The report said the contribution of the mining sector to exports increased from 68 per cent to 77.65 per cent in 2014, while investments reduced from 3.4 per cent to 1.6 per cent.
 
In terms of economic contribution, the report indicates that the contribution to Zambia's Gross Domestic Product (GDP) reduced from 33 per cent in 2013 to about 32 per cent in 2014.
 
The report said about K1.8 billion was paid out in terms of Value Added Tax (VAT) refunds to companies.
 
It indicated that there was a slight decrease in terms of copper production which reduced from K754, 918 tonnes in 2013 to 708,259 tonnes in 2014.
 
Mr Yaluma noted that the EITI report included information on the structure of the extractive sector in Zambia, the applicable legal regulatory framework, in addition to how much was paid by companies and received by Government.
 
He also said that Government had put in place a mechanism that will ensure that the country diversifies from copper to other minerals within the mining industry in the wake of the falling copper prices.
 
"It is important that we diversify from copper to other minerals within the mining industry.
 
We think that doing so, will help sustain the economy in the next five years," Mr Yaluma said.
 
 

Source : allafrica.com
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