Looks like it's all over, bar the shouting. Bloomberg report today that the Zambian parliament has approved an amendment to the Mines and Minerals Act, leading to an increase in taxes and the abolition of existing agreements between the government and mining companies. Royalties on sales will be raised to 3 percent. Corporate income tax will be raised to 30 percent. The tax rate on miners will now be 47 percent. As a result of tax increases, Zambia is expected to earn $450 million in additional revenue. Fred Bantubonse, general manager of the Chamber of Mines, has expressed concern that the amendments to the M and M Act will compromise future investments as miners shy away from expansion projects that would now generate poor returns. Bantubonse makes no mention of any legal action, suggesting that, as predicted on this blog, the mining houses were attempting to frighten the Zambian state with threats of litigation, but eventually backed off recognising that the state holds all the cards.
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Bantubonse makes no mention of any legal action, suggesting that, as predicted on this blog, the mining houses were attempting to frighten the Zambian state with threats of litigation, but eventually backed off recognising that the state holds all the cards.
With all the talk of leaving the country - that was never a realistic threat. They would lose too much time setting up new mines, while all the time the copper price could go againt them.
And all that to avoid paying taxes?
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