By Dennis Ndlovu|Zim GBC News
Zimbabwean lawmakers have urged the government to reconsider proposed royalty rates on gold producers in the 2025 Finance Bill. The parliamentary debate centered on protecting small-scale and artisanal miners, with legislators arguing that higher taxes could negatively impact the crucial sector.
The original bill proposed adjusting royalty rates for gold miners, sparking fears that it would discourage local producers from selling through formal channels like Fidelity Printers and Refiners.
MPs across the political spectrum rallied to defend small-scale miners, who contribute a large share of the country’s gold output.
Hon. Pupurai Togarepi made a clear distinction between local and foreign investors.
“For a person who is investing in Zimbabwe, he wants the gold in Malaysia, Britain. we want a share of that gold before it leaves Zimbabwe. However, for a person who is producing gold here in Mazowe, we want all that gold to go into the Reserve Bank,” noted Togarepi.
He also warned that anything above a 2% royalty for locals would discourage our local gold producers to take gold to the Reserve Bank. We will lose more gold.
Hon. Supa Mandiwanzira went further, proposing a zero-tax rate for artisanal miners, arguing they are already taxed through price discounts at Fidelity.
“To bring another tax is double taxing the small-scale and artisanal gold miner,” he said
The Minister of Finance, Prof. Mthuli Ncube, conceded to the pressure, announcing a tiered system for large-scale miners based on global gold prices, while leaving small-scale miners’ rates unchanged.
“For small-scale miners, no change,” he declared, confirming that their royalty would remain at 2%.
He explained the compromise.
“We have a situation of arbitrage. We think that as much as 50% of the gold being delivered by small-scale producers is actually from large-scale producers because they realise that there is a lower royalty.”
The debate also extended to other minerals. MPs successfully pushed for an increase in the export VAT on unbeneficiated chrome from 5% to 10%, aligning it with the rate for lithium.
Hon. Tendai Nyabani argued for even stiffer penalties to encourage local processing
“If we give 3%, is it for donating our minerals?. What we want is to have these plants so that the beneficiation is done in Zimbabwe and we create employment in our country,” he said.
The outcome reflects a legislative consensus on using tax policy to incentivize formal mineral sales and local value addition, while safeguarding the livelihoods of small-scale miners.
As Hon. Malinganiso Taurai Dexter also said,
“If our artisanal miners, our small-scale miners, are charged just one percent, the gold will flock to Fidelity and our reserve will even grow bigger.”
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