February 18, 2011

Mine tax to hit K2.8 trillion

Bank of Zambia governor Caleb Fundanga announced that Government expected about K2.8 trillion tax revenue from mines in 2011. He said mines used to contribute about K4 billion a few years ago, but the figure grew to K1.3 trillion in 2010. Furthermore, he said that the gross domestic product (GDP) growth of 7.1 percent in 2010 was good and may spur growth in 2011 above the 7 percent target. According to him, the GDP growth in 2010 from 6.4 percent in 2009 was largely driven by positive developments in the agriculture, construction and mining sectors.

Fundanga also noted the record high maize harvest of 2.8 metric tonnes and higher copper prices and production levels and growth in the construction sector were the major drivers of economic growth. He said growth in the construction sector emanated from increased residential, commercial and public infrastructure construction projects across the country by both Government and the private sector. “This GDP growth was good. It was above the 6.4 percent estimated growth in the budget. If we continue to grow like this, we may reach 8 percent,” he said. Fundanga also emphasised that Zambia should not party over the good copper prices, but use the earnings to diversify economic activities. Earnings from the mines were good, he revealed, with revenue of 45 percent accruing to the people of Zambia from taxes and shareholding in the mines ranging from 15 to 25 percent. (Daily Mail)

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