London, England — MININGREVIEW.COM — 04 December 2009 – The government of Zambia has revealed that it is planning no tax rises for mining companies in 2010, and it says the country is expecting an increase in foreign direct investment to US$2 billion (R15 billion) next year.
“You cannot just be playing around with taxation “’ one year you do this, another year you do that,” Zambian trade minister Felix Mutati told Reuters here in an interview on the sidelines of a Zambia investment forum. “Our focus will not be new taxes for the mining sector, let’s encourage investment…there will be no tax increases in the mining sector, he insisted.
The International Monetary Fund and World Bank had said Zambia should increase its mining taxes and should not have abolished a 25% mineral windfall tax this year.
Reuters reports that the southern African country of 12 million people has been waiving taxes “’ including a 25% import duty on imported equipment and 16% value added tax “’ for foreign companies investing in economic zones, in a bid to attract more investments and create jobs.
Mutati said he saw foreign direct investment into Zambia increasing to US$2 billion (R15 billion) in 2010 from around US$1.5 billion (R11.25 billion) this year, due to investment in economic zones, shopping malls, mining, agriculture and infrastructure.
He added that Zambia was the largest recipient of FDI in sub-Saharan Africa after South Africa.