The Zambian Centre for Trade Policy and Development (CTPD) says the government should consider expanding its shareholding in local mines in order to reduce tax evasion and maximise on mineral revenue collection.
The CPTD is a Lusaka-based, non-governmental economic think-tank that undertakes regular studies on the state of the economy in Zambia. The recommendation is among key findings of a CPTD study which examined new strategies for the equitable sharing of mineral revenues between investors, governments and host communities.
The CPTD report noted that despite a long history of earning mineral revenues, Zambia had failed to progress to a middle-income country like Botswana, because its only financial benefit from the extractive industry was taxes. To reap enough to drive development, CPTD said government could expand its share-ownership into the mother corporations of local mining concerns.
“There is need to broaden government shareholding over minerals in the face of rampant tax avoidance and evasion. The government should consider holding equity, not only in the local subsidiary of multinational mining companies, but their mother corporations as well. That would allow government to gain not only from a tax basis, but on a dividend basis as well,” the report said.
Further, the report said there was a need for government to ensure the participation of local communities and strengthen their voices so that they could benefit from the sharing of the mineral resources extracted from their areas.
