Zambia cabinet to present changes to mining royalties on Monday - CNBC Africa

Zambia cabinet to present changes to mining royalties on Monday

Mining

by Reuters 0

The decision to increase royalties in January for open pit mines and for underground mines rattled foreign mining firms.

Zambia’s cabinet will table changes to mining royalties on Monday after the finance and mines ministers proposed the amendments.

This is according to the president’s spokesman.

Zambian President Edgar Lungu last month directed the finance and mining ministers to change royalties on mining firms by 8 April, saying the copper-producer could consider temporarily reverting to the tax regime in 2014.

“The technical committee has finished looking at the proposals from the ministers of finance and mines. Cabinet will table the proposed changes on Monday,” presidential spokesman Amos Chanda told Reuters.

(READ MORE: Lack of policy clarity hampers investment into Zambia mining)

The decision to increase royalties in January for open pit mines to 20 per cent from 6 per cent and those for underground mines to 8 per cent from 6 per cent has rattled foreign mining firms in Africa’s second-largest copper producer.

Unions are also worried that jobs could be lost.

Zambia’s kwacha has gained lost ground against the dollar as the market anticipated changes to the existing tax regime in favour of mining companies.

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