Mozambique’s revised mining tax code set to increase state revenue - CNBC Africa

Mozambique’s revised mining tax code set to increase state revenue

Mining

by Trust Matsilele 0

Mozambique’s revised mining tax code set to increase country's revenue. PHOTOS: Wikimedia

The projected increase will be in the region 30 billion US dollars in the mining sector.

(READ MORE: Mining and financial sectors fuelling Mozambique’s economy)

This increase will be the main result of the levying of tax on production, Finance Minister Manuel Chang has affirmed.

Figures for the increase in revenues from the state in the levying of the new Gas and Petroleum Tax have not yet been made available.

“The real focus of the new Resource Tax Law seems to increase the state’s control and participation in the mining, oil and gas sector,” said a statement from African Influence Exchange.

“While this shift was anticipated as it is reflective of Mozambique’s current legislative trend and consistent with the draft laws made available by the Government, many of the requirements that are likely to be controversial for investors were introduced at the very late stages of development of the new legislative regime and against a backdrop of political transition in the country.”

African Influence Exchange said the impact of this increased control, will become more apparent over the coming months.

(WATCH VIDEO: Opportunities thrive for Africa’s oil and gas sector)

Significant changes for the mining, gas and petroleum investors include Capital Gains Tax regime, significant changes in production taxes, production tax royalties, determining of valuation and pricing, increased corporation tax liabilities among others.

“As Mozambique enters a period of Government transition coupled with the recently approved Mining Law and Petroleum Law, Mozambique and its new government are preparing for the next phase of mining, gas and petroleum production in Mozambique,” said Nerina Van Wyk, director of African Influence Exchange. 

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