Zimbabwe platinum miners ask government to defer export tax

14th November 2023 By: Bloomberg

Zimbabwe platinum miners ask government to defer export tax

Photo by: Bloomberg

Zimbabwe platinum miners have asked the government to defer its planned 5% export tax on concentrates, pending the completion of smelters and the refurbishment of a refinery.

The producers want the tax deferred until 2025, according to a proposal submitted by the Chamber of Mines of Zimbabwe to the finance ministry before the 2024 budget presentation later this month. After announcing the tax in 2020, the Treasury initially gave miners two years to prepare, before later deferring it until January 2024.

The government is introducing the levy on shipments of platinum group metals’ concentrates to spur the development of processing facilities in Zimbabwe. Impala Platinum Holdings' Zimplats unit is on track to refurbish its base metal refinery and other smelters by 2025, the chamber said.

“To this end, we are appealing for further deferment of export tax on PGMs concentrates to align with Zimplats timelines for completion of their beneficiation projects,” it said.

Zimplats plans to spend $1.8-billion expanding mining and processing, including rehabilitating an old base-metals refinery built by BHP Group.

The chamber also said that an increase in the royalty on PGMs to 7%, from a previous rate of 2.5%, was impacting the viability of projects, especially after a decline in prices. It appealed for a lower royalty that could be adjusted with prices.

“We appeal for a royalty of around 3%,” the chamber said. “The royalty can be reviewed in line with movements in platinum prices up to a maximum of 5%.”

Zimbabwe holds the world’s third-largest known reserves of platinum.