The Centre for Trade Policy and Development (CTPD) has called on government to withdraw the suspension of the 15% export tax on gemstones and precious metals.
CTPD Research Associate- Extractives Centre for Trade Policy and Development, Stephen Kambani, says the decision to suspend the tax undermines Zambia’s capacity to maximize long-term benefits from its mineral resources and weakens the country’s efforts to promote value addition in the mining sector.
Dr. Kambani said that consistent application of export taxes is critical in encouraging investment in local value addition and enhancing revenue collection to support Zambia’s economic development.
“Taxes are the main source of government revenue used for financing its budget including health, education, defense and infrastructure programs, and the ultimate goal of any government’s mining tax system is to ensure the greatest possible benefit for the public while simultaneously encouraging investment in the sector”, said Dr. Kambani in a statement issued to RCV News in Lusaka today.
He noted that for a country like Zambia that is a mineral dependent, there is need for government to strategize on maximizing revenue from the mining sector over time.
Dr. Kambani said to justify the suspension of export tax on gemstones and precious metals that Zambia does not have the local capacity to add value is not only narrow, but also undermines the country’s ability to maximize benefits from its resources over time.
He has since encouraged mining companies of gemstones and precious metals add value and improve their international competitiveness as opposed to demanding for tax exemptions.
Christabel Kamunu
