THE windfall tax dreaded by mining companies in Zambia may return after discussions in Cabinet are concluded said Mr Bob Sichinga, the Commerce and Industry Minister when he spoke on Radio Phoenix in an interview yesterday.
Sichinga was responding to calls during the programme-Government and You-aired live on Radio Phoenix saying ways have to be found of bringing back the tax without hurting the mining companies that employ more than 40,000 miners.
“I was a supporter of windfall tax before elections and I am still a supporter of windfall taxes now,” Mr Sichinga said, “we are still looking at that (windfall tax) but at the moment I think we are okey with the increase in mineral royalties from 3 percent to six percent.”
Sichinga also said he wants interest rates presently at an average of 15 percent to come down to 10 percent so that more money can be freed in the economy following the government’s decision to reduce base rates through the Central Bank.
“I feel interest rates must go down to as low as 10 percent,” Sichinga said, “they could reduce even further in my view.”
Mr. Sichinga is the second cabinet minister to indicate that the windfall tax, which has been opposed by foreign mining companies, may return after his colleague Mr Alexander Chikwanda, the Minister of Finance spoke to accountants at hotel Inter-Continental in Lusaka on Friday night.
Zambia wants to raise money to create jobs and reduce poverty according to President Michael Sata whose election campaign was based on “more money” in the pockets.
Earlier, Mr Sichinga said Zambians should not be disappointed with the Patriotic Front (PF)’s decision not to reintroduce the windfall tax in the 2012 national Budget.
Mr Sichinga said the 2012 national Budget is not entirely within the control of the PF because it was swayed by the commitments made by its predecessor, the MMD administration.
“What the minister has said is that he has decided to play it safe by including the mineral royalty taxes, increase and double it from three percent to six percent.
“I believe the mineral royalty taxes will help raise us sufficient money while we examine what else needs to be done with regards to the issues of the windfall tax,” Mr Sichinga said.
He said the PF government will have to honour some of the agreements made by the previous administration because it is the government in power.
Mr Sichinga said by increasing the mineral royalty and not reintroducing the windfall tax means Mr Chikwanda had to do a balancing act.
He said Mr Chikwanda needs time because when the September 20 tripartite elections date was set the country had already past the stage of preparation of the budget and that is why it was not presented in October like it happened in the previous years.
Mr Sichinga said the PF government is tied up significantly by the activities and promises and commitments made the MMD and further changes to the collection of taxes in the mines become necessary after reexamination.
[Zambia Daily Mail]
hmmm maybe you have realised that the MMD’s policy’s were necessary and as the opposition party you were just making noise.Its all easier said than done.
pf and lies, but you promised that it would be done within 90 days.
Looks like these kids party is learning things very fast at justifying their stance with strange rhetoric. That is what happens when the rubber meets the road my good friend Bob. It is easier to sit at the roof top and scream windfall tax , windfall tax but when you are at the controls it suddenly dawns on you that actually MMD was doing a great job.
And no doubt this Budget you have present is purely an MMD budget and I hope you have the people to execute the implementation. I say this because you say you want 7 % inflation, 7 % growth and 4.3 % borrowing..this is straight from MMD, but alas your manifesto is more money into people’s pocket, raise salaries everywhere and it will be interesting to see how you balance this. Welcome to real economics, PF
Dont kudabwa,,Bob time for rhetoric is gone,people expected that in the budget not the save face you want the public to believe
@No.2
The good thing with us level headed PF sympathisers is that we give constructive criticism when our leaders stray unlike you MMD clowns who are still in self-denial, how dare you compare a highly corrupt MMD government to the current government. You talk of all these figures ie $2 Billion in reserves tell that the ordinary low income worker, MMD Budget?? so what, Did MMD have plans to increase mine royalties? No chance, Did they have plans to reduce PAYE for low earners? Did MMD have plans to reduce Bank corporation tax to stimulate borrowing? Not in a million years. They just cared about themselves!!
Grow up or jog on mate!!
Bob Sichinga has also fallen in the same trap of lying like his President-Mwana wanjoka ninjoka kumene.You raised alot of people’s adrenaline that in 90 days it will be heaven on earth,alas its all excuses,mmd this,mmd that.Anyway this is always the case when you use the heart than the brain for thinking.Can Zambians please,for once, take these leaders to task to learn to account for what they say.Chanda Chimba,wherever you are continue recording what is being said,we shall need it later.
This monkey MMD chief Boot licker is a moron. He is a dreamer who thinks MMD will rise again.
HH is wise. He has repeatedly proposed for the same.
#2MMD chief bootlicker,,,please criticize with logic and don’t pretend to be wise and later say nonsense. We don’t need more money in the pocket at the spot but we want to see a government at work,,, giving us hope for tomorrow… VIVA PF for the step taken over the council worker in zambia.. over 20years no one thought of this hard working poor people in zambia…
It’s good that Govt is looking at this issue. Lets wish them well. It’s complex and a fight against very powerful companies. That’s why weak leaders just buckled. Pray for the govt to be strong and wise.
Well, well. Thisd is the real politik! More money in people’s pockets and low inflation when the production is stagnant is an economic monstrosity! This is like ‘eating your cake and having it.’ The Mines Chamber of Commerce Bantubonse has already warned that there may be a deleterious effect on mining operations in Zambia by this behaviour of the PF. I can forsee the Kaunda syndrome returning to Zambia soon if PF remain popular for more than 5 years. There will be re-nationalisation of the mines in order to prevent them from what KK used to call ‘econmic subortage’ and derailment of PF party programmes.
Government should introduce windfall tax-HH Friday, 11th November, 2011.
PF has no spine to re-introduce the windfall tax.
Ba #3booklicker please acquaint your self with how civil service opperates. Politians dont make budget and hence you can NOT say MMD budget. Politians just posses the will to implement. This govt has the best papers by civil servants collectn dust, papers that would steer this contry in the right dierction but politicians will do the opposit for their own sake. Just look at how RB ran the country like his property
Newer investors are best attracted when there’s predictability.To say you ‘may” reintroduce the windfall tax is at best a self inflicted wound to your ability to attract new investors to zed.Policies guiding investor tax should never change with the whims of a new govt.They need only change when and if the tax holiday runs out regardless of who the next prez is.Predictability my friends,predictability is very important on whether the next investor decides to bring their cash & jobs to zed.
better introduce it in next year’s budget since u say this budget was MMD inclined i want windfall tax back.VIVA PF VIVA PF.
I only wonder how many fools realy understand the history of winfall tax and how it is implemented.
Some Banks make super profit but why are they not subjected to windfall Tax