MINERAL RENT IN NAMIBIA

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MINERAL RENT IN NAMIBIA

• By Veston Malango, Deputy Director of Mines,
  Namibia.
  
• At the ECA/UNCTAD/UNDESA Lusaka Seminar,
  Aug.13-15, 2002
  

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1. Corporate Tax under Income Tax Act.

• 35 for non-mining operations
• 55 for Diamond Mining Operations
• (concerns have been expressed that this too
  high)
  
• Sliding formula for other mining operations
• (fluctuating between 25-40 )

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Problem with Corporate Tax

• Government does not have enough capacity to
  analyse company tax returns.
  
• i.e.Accuracy of tax declarations is difficult to
  verify, leading to possible losses of rent /
  revenue to Government.

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2. Royalties under Minerals Act.

• 10 fixed for diamonds, emeralds, rubies and
  sapphires(precious stones) and gold(precious
  metals).
  
• 5 for dimension stones(marble, granite)
• through the the government gazette.

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3. Licence Fees under the Minerals Act.

• Application fees
• Annual licence fees

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4. Diamond Licence Fees under the new Diamond
Act, 1999

• Diamond Dealers Licence
• Diamond Cutting Licence
• Diamond Tool Manufacturing Licence
• Diamond Research Licence

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5. Challenge is

• What are priorities of Government in the
  distribution of mining rent (budget)?
  
• Namibias case Health and Education Sectors
  receive the lions share of the budget.
  
• This is in line with one of the 4 challenges of
  mineral development(creation, distribution,
  macroeconomic / political and investment in
  education, human health,institutions etc. ) for
  sustainable development.