The Zimbabwe government has reduced corporate tax for miners by one percentage point to 24% to enable resources companies achieve acceptable returns from their investments, reduce costs and ensure optimal exploitation of minerals, Finance Minister Mthuli Ncube said Monday.
Speaking at a post-budget meeting in the capital, Ncube, said the government had for a many years ignored the call to reduce tax for miners, something which does not augur well for an administration that has identified mining as one of the critical sectors to anchor economic growth, alongside agriculture and tourism.
“The government reduced corporate income tax rate from 25% to 24% with effect from January 1, 2020.
The decision was motivated by the desire to enhance the return on equity, a key success factor in the drive towards improving investment flows,” Ncube said.
Recently, the government tabled an ambitious policy document which sees the mining sector turning into a US$12bn industry by 2023.
The blueprint targets gold output of US$4bn per year while platinum is expected to grow to US$3bn.
Diamond is expected to grow to US$1bn. Other minerals are expected to contribute the remainder.