Finance and National Planning Minister Situmbeko Musokotwane has emphasised the government’s strategic shift towards implementing moderate mining taxes, aimed at rejuvenating copper production and enhancing investor confidence.
Dr. Musokotwane clarified that the recent tax adjustments were not tantamount to offering tax breaks to mining companies. Instead, they were aimed at aligning Zambia’s tax structure with global mining industry standards. He highlighted how previously, excessively high taxes under the previous administration had served as a deterrent to investment.
Speaking at a public forum organized by News Diggers in Lusaka, Dr. Musokotwane underscored that during the previous administration, mining wasn’t as attractive due to the imposition of excessive taxes. He stressed the importance of normalizing taxes to attract and retain investment in the sector.
Dr. Musokotwane pointed out that the recent tax adjustments have already shown positive outcomes, with companies like First Quantum resuming production and Lumwana expanding operations. He also mentioned Mopani’s return to mining activities and the emergence of new mines, indicating a promising outlook for copper production by 2026-27.
In response to suggestions for the enforcement of windfall taxes, Dr. Musokotwane reiterated that sur-taxes still exist but emphasized the government’s focus on standardizing taxes in line with other mining jurisdictions through benchmarking.
Acknowledging the economic challenges faced by citizens, Dr. Musokotwane emphasized the government’s commitment to dismantling the debt inherited from the previous administration. He emphasized the need for prudent debt restructuring to alleviate the burden on citizens without overtaxing them.
Various stakeholders, including the Economic Association of Zambia (EAZ) president Oswald Mungule and CSO Debt Alliance Chairperson Fr Alex Muyebe, echoed sentiments for prudent debt management and the need to explore innovative solutions for debt restructuring.
Yande Siame Mwenye, President of the Zambia Institute of Chartered Accountants (ZICA), advocated for revisiting the windfall tax and exploring alternative revenue streams such as carbon taxes. She also suggested reviewing existing agreements and taxation frameworks to ensure their relevance and effectiveness in current economic contexts. Furthermore, Mwenye proposed enhancing accountability in resource management by deploying qualified accountants to oversee the Constituency Development Fund (CDF) at the constituency level, aiming to curb mismanagement of public resources.
Main Image: Kalemba News
