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Congo president vows constructive dialogue over mining levy

Mining News - Published on Tue, 13 Mar 2018

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The Citizen reported that DR Congo President Joseph Kabila has promised to have “constructive dialogue” with mining companies worried over plans to hike taxes on so-called strategic metals, a category expected to include the booming market for cobalt and copper. Mr Kabila held more than seven hours of talks with leading players in the Democratic Republic of Congo’s mining sector over plans to change the country’s 2002 mining code.

Mr Kabila’s office said in a statement released late that “The president reassures mining operators that they are economic partners in the DRC and that their concerns will be taken into account through a constructive dialgoue with the government after the new mining law is approved, with a view to finding compromise.”

In meeting, Kabila and the mining firms agreed to deal with problems on a “case-by-case” basis, officials said.

Mining Minister Mr Martin Kabwelulu said that there would be “implementation measures” that would “ease the toughness of the law.”

Mr Kabwelulu said that the mining executives arrived “worried” but “left calm.”

The government last year signalled its intention to reform its 2002 mining code, which it considered to favour foreign investors at the expense of the economy.

A first version of the draft law examined by the lower house, the National Assembly, in December, and then by the Senate in January envisaged a tax takes on “strategic metals” of five %.

This has been revised upward to 10 %, under a new draft approved by a joint commission of the Senate and National Assembly on January 27.

At present, the state levies a tax of two percent on non-ferrous metals copper and cobalt which is based on the value of sales, from which some costs are deducted.

The draft law, which is now in Kabila’s hands, would also scrap a clause in the 2002 code that gives a 10-year guarantee of no change to the terms of mining contracts.

There would also be a tax of 50 % on windfall profits so-called super-profits that occur when prices go at least 25 % above a given benchmark.

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Posted By : Rabi Wangkhem on Tue, 13 Mar 2018
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