Africa’s second-largest copper producer said it will also charge corporate income tax on mining operations at 30 percent, while mineral processing will attract a tax of 35 percent when the law takes effect on July
The cabinet also approved a 15 percent variable profit tax on income when taxable earnings exceed 8 percent of gross sales, while claims of losses will 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.
Din told reporters late 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, I 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 from 6 percent and those for underground mines to 8 percent from 6 percent in January had rattled unions and miners, forcing the government to review the plan.
Other foreign firms running mines in Zambia include Glencore, Barrick Gold Corp and Canada’s First Quantum Minerals.