Vedanta’s Zambia copper unit to remain loss-making under new taxes: CEO




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LUSAKA – Zambia’s Konkola copper mines, a unit of Vedanta Resources Plc, remain loss-making under a new tax regime that comes into effect in July, its Chief Steven Din said.

Zambia’s set country’s royalty tax rate for open cast and underground mining at 9 percent on , although changes are yet to be approved by parliament.

’s second-largest copper producer said also charge corporate income tax on mining operations at 30 percent, while mineral processing attract a tax of 35 percent when law takes effect on July

also approved a 15 percent variable profit tax on income when taxable earnings exceed 8 percent of gross sales, while claims of losses be limited to 50 percent. Officials had said some mines would claim to have incurred losses for a prolonged period, and avoided paying any tax.

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Din told reporters on Wednesday that Konkola was, however, comforted by the government’s willingness to talk to mining companies on the problems they were experiencing.

“So if the mining companies certainly feel that they still have difficulties, believe that the government will be listening and then we will have a win-win solution,” Din said.

Zambia’s decision to increase royalties for open pit mines to 20 percent 6 percent and those for underground mines to 8 percent 6 percent in January had rattled unions and miners, forcing the government to the plan.

Other foreign firms running mines in Zambia include Glencore, Barrick Gold Corp and Canada’s First Quantum Minerals.

 

*(Reuters)*