New proposal to levy miners 5pc

Source: New proposal to levy miners 5pc | eBusiness Weekly

New proposal to levy miners 5pc
Dr Bimha

Martin Kadzere

Zimbabwe’s governing party, Zanu PF, wants mining companies to be levied 5 percent of their revenues to fund development of communities where they conduct their business, a senior official has revealed.

“As a party, this is what we want to see in our policy,” Zanu PF secretary for economic empowerment, Dr Mike Bimha told Business Weekly newsletter in a telephone interview this week.

“As the ruling party we give direction (policy formulation), but as it is now, we cannot compel anyone to comply since it is still a party policy.”

The party recently launched the new indigenisation and empowerment policy-2020-2030, which seeks mining companies, excluding artisanal miners, not participating in community share ownership schemes to establish corporate responsibility programmes.

About two thirds of the funds will go towards community development programmes in the district where the company is operating while the remainder will be equally shared among other districts in the same province, Dr Bimha said.

Levying companies for the purposes of development is in line with the Government’s devolution agenda.

Devolution refers to the cascading of powers and responsibilities to lower levels of governance by the central Government and in Zimbabwe a key feature of this is the creation of provincial councils that will become the authority in the running of affairs in the country’s regions.

Section 301 of the Constitution provides for Intergovernmental Fiscal Transfers from central to provincial and local tiers of Government to support devolution.

It is anchored on the overriding objective of promoting sustainable, representative, accountable and inclusive governance. It recognises the right of communities to manage their economic affairs and further their own development as well as encouraging the equitable sharing of local and national resources.

The model of devolution will facilitate investment in various districts at growth points.

Implementation of devolution emphasise regional economic development. This, therefore, entails the development and tracking economic activities at district and provincial levels; hence the need for developing and monitoring of Gross Domestic Product (GDP) statistics at district and provincial levels. Provinces will be required to co-ordinate and monitor the development of such statistics in the respective jurisdictions with technical assistance of the relevant Government agencies.

The national GDP will be disaggregated to the provincial level for competitiveness purpose.

The provincial management of the economy entails working closely with the private sector to capture data and understanding their requirements.

President Mnangagwa’s administration discarded the previous indigenisation policy, which forced foreign-owned businesses to cede 51 percent shareholding to black indigenous people, arguing it was scaring investors.