'Increase diamond tax'

HARARE - Zimbabwe must increase taxes on diamond mining companies to cushion the poor and mobilise enough resources for social service delivery, a lobby group has said.

The Zimbabwe Coalition on Debt and Development (Zimcodd) in its April report said diamond revenues were not benefiting the poor.

“Diamond mining is still shrouded in secrecy thereby impinging on transparency and accountability. This lack of transparency and accountability paves way for illicit outflows of diamond revenue.

“Government should ensure transparency and accountability through installation of tight monitoring and evaluation mechanisms of mining claims.

Accounts for companies in which the government is party to must be audited and results publicly disseminated,” read part of the report.

Until recently, diamond revenue has been a bone of contention with conflicting reports from the Finance and Mines ministries over remittance of diamond mining revenue.

Last year, Finance minister Patrick Chinamasa told parliamentarians in Victoria Falls at a 2013 Budget Review Seminar that out of a targeted $40 million expected from diamond sales, nothing had been received by  September 2013.

Last month, diamond companies operating in the Marange area declined to support a community ownership trust, arguing they were never formally informed about its existence.

“The fact that these companies are backtracking on their pledges simply shows that government is relaxed in dealing with them, government must be stern with these companies,” noted Zimcodd.

Currently, there are seven companies operating in Chiadzwa namely Mbada Diamonds, Marange Resources, Anjin Investments, Diamond Mining Company, Kusena and Gye Nyame.

The companies operate as joint ventures with government through the Zimbabwe Mining Development Corporation (ZMDC). Marange Resources is, however, wholly-owned by the ZMDC.

The report also says out of these seven mining companies, only Mbada Diamonds publicly declared its mining revenues.

“If indeed Mbada Diamonds paid dividends to government it should be established how the money was used as people did not benefit from the revenue raised from the diamonds.

“Social service delivery did not improve from 2008 to date, the government failed to put the economy on the recovery path,” says the report.

Zimcodd said the Minerals Act must be reviewed to ensure that there is transparency and accountability.

“Diamonds must be taken as strategic resources. They must be nationalised and put under the direct control of government and are exploited for the full benefit of all citizens.

“There is also need to minimise revenue losses from the diamond industry through capacitating the Zimbabwe Revenue Authority to effectively collect what is due,” read the report.


Comments (1)

If mbada is the only operator who shares it's info and pays its taxes, they should be the only miner as well

Africanboy - 28 April 2014

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