IS IT IGNORANCE, ARROGANCE OR THE SHEER PROPENSITY FOR TELLING LIES?
Minister of Mines, Paul KABUSWE is quoted in the News Diggers newspapers, saying that, Vedanta won’t be given Tax Holidays.
This statement coming from a Minister is appalling to say the least. Is it that the Minister is ignorant of his own ministry’s mining tax policies, is it the arrogance of power or the man is genuinely incapable of telling the truth?
In case Hon Kabuswe doesn’t know the taxation regime that his Ministry is implementing, we are here to enlighten him that his Government has given TAX HOLIDAYS to all foreign multinational mining corporations. These tax breaks are applicable to all foreign mining firms operating in Zambia, Vedanta inclusive.
In 2021, Finance Minister Situmbeko Musokotwane in his first budget presentation under the UPND administration, announced the introduction of tax breaks for mining companies, making Zambia keep losing hundreds of millions of dollars annually in ‘unpaid mining taxes’.
Coupled with tax avoidance, price transferring, tax refunds, capital flight, externalisation of profits and other illicit financial flows, Zambia is losing an estimated 3 billion US dollars annually from the mining sector alone.
Just like in the 2021 national budget, the UPND Government in their last year’s budget, again, gave mining companies tax holidays by reintroducing deductibility of the mineral royalty tax.
As if that is not enough, this Government has further given foreign mining companies more tax exemptions by suspending import taxes on mining equipment and machinery, making Zambia and Zambians lose even the little revenue they were collecting from the mines. (See, Statutory Instrument No. 50 of 2022)
Zambians must get very worried when they hear those that they have entrusted with the constitutional authority to superintendent over the affairs of the country expose such ignoble levels of ignorance and deceit to mislead the unsuspecting and suffering masses.
We wish to reiterate our resolve that Government must cancel these insane tax breaks they have given to foreign mining multinationals who are ripping the country off billions of dollars and instead give tax incentives and tax holidays to our own Small and Medium Enterprises (SMEs) that are struggling and folding due to high taxation, lack of tax incentives, lack of liquidity, high interest rates, high inflation, currency volatility, high cost of doing business, general economic hardships and an unfavourable working environment.
Currently, almost all major and minor Government contracts and payments are going to foreigners at the exclusion of our own local businesses. This is worsening the already desperate youth unemployment levels and crowding out local SMEs which are critical to job creation and alleviation of poverty.
It is high time that President Hakainde SAMMY Hichilema and his team of ministers, like Hon Kabuswe, realise that they are in office to serve and protect the interests of Zambians and not the interests of foreigners and their masters.
The billions of dollars we are losing from the unpatriotic tax breaks given to the foreign mining corporations is the very money the country desperately needs, to invest in infrastructure, electricity, fuel, medicines, agriculture and other key sectors in order to improve the economy, reduce the high cost of living, create job and business opportunities for our women and youths and reduce the dehumanising poverty levels that the majority of our people are going through.
Issued by;
Antonio Mourinho Mwanza
Deputy General Secretary
Socialist Party Zambia