The Sunday News
From Gabriel Masvora in Vic Falls
FINANCE Minister Patrick Chinamasa said he was waiting to gauge how the economy would have performed by the end of June for guidance on some of the pronouncements that he will make in his mid-term fiscal policy statement which has been moved to July.
The mid-term fiscal policy review is normally presented every year in June.
In an interview in Victoria Falls on the sidelines of the Chamber of Mines conference on Friday, Minister Chinamasa said consultations had started for the review.
“Definitely I will present the statement. I will not do that in June this time. I need to wait for June figures and that is when I will come up with the statement,” he said.
Cde Chinamasa, however, noted that it would not be an easy task considering the performance of some key sectors of the economy.
Captains of industry noted that it remained to be seen what sort of direction the review would provide but were quick to point out that it would be difficult to effectively follow Government pronouncements in budgets as some of them were rarely followed to their conclusion.
They noted that a number of issues that were raised in previous budgets had not been religiously followed.
“Even most of the allocations to key sectors are not followed. It is rare for most of the projects identified in budget statements to even get half of the allocated support,” noted a mining executive with a leading mine in Zimbabwe.
Addressing the gathering Minister Chinamasa promised that Government would soon announce a new mining fiscal regime to ensure efficiency and transparency in the mining sector.
“From a tax management perspective, it suffices to say that there is a need for efficient, transparent, administratively simple and productive tax systems. These are the basic principles that are central to the design of any tax system,” he said.
Government was working with the Norwegian Embassy and World Bank to develop a new framework on the taxation of mines.
He said the main objectives of the mining fiscal model would be to promote simplicity, ensure optimal mineral extraction and revenue generation and promote transparency in the sector.
He, however, blasted mining companies that were withholding information on their revenues and payments which was making it difficult for Government to come up with the right tax regime.
“Only the gold sector has provided their figures. All other sectors have not and we wonder why. Our partners have complained that the local mining industry is opaque.”
He said Government would be forced to come up with legislation that compels all mining companies to provide such information.
He added that it was worrying that when it comes to paying tax some companies always complained that they were not generating anything while on the surface there were signs to the contrary.
“You see companies coming to us saying we are not making anything but they are paying salaries every month, they pay 100 percent to their suppliers. So how do you want us to believe you when you come and say we are not making anything and we are struggling to pay tax. Come on you are not here for charity.”
He said it was for the benefit of the mining companies to co-operate with Government initiatives.
“You must not complain tomorrow when we come up with policies that you are not happy with because when we say come let’s talk you hide the information.”
However, Chamber of Mines outgoing president Mr Alex Mhembere said mining companies had been co-operating with Government in all requirements from revenue to production figures.
“From the first mining stage, miners have to regularly update on the progress of both revenue and production figures. As a chamber we also do updates of production per quarter.”
He said maybe the information was not reaching the relevant authorities in the right format which could be used to inform what was happening on the ground.
