Copperbelt-based good governance activist Peter Mulenga has castigated Sociality Party leader Dr. Fred M’membe for saying that Zambians should not celebrate the imminent IMF deal because the country is losing millions in uncollected mine taxes.
Dr. M’membe this week said going for an IMF deal while giving tax breaks to investors was not adding up.
Dr. M’membe’s comment came as IMF Managing Director Kristalina Georgieva said. “The support from the Official Creditor Committee for Zambia’s envisaged IMF-supported program, together with its commitment to negotiate debt restructuring terms, provides the IMF with official financing assurances.”
Reacting to Dr. M’membe’s negative comment against the IMF deal, Mr. Mulenga said the mining taxation system in Zambia was not bad as portrayed by the Socialist Party leader.
Mr. Mulenga also questioned how Dr. M’membe arrived at $3bn he thinks Zambia losses.
“This is my reaction to the article by Dr. Fred M’membe, President of the Socialist Party claiming that Zambia can’t celebrate scoring the IMF deal of $1.4bn because the country loses $3bn in mining taxes. Can I just say that mining houses are paying their fair share of taxes in Zambia. Yes there are still loopholes in tax collection but I feel the Government is fixing all loopholes in tax collection. Mining taxation policy is ok in Zambia. Equally important is that these same mining firms are also operating in other countries and they are contributing their share in their respective countries. However, let’s not talk about what other countries are collecting from these same firms. If you look at Alexander Nkosi’s analysis, you will find Dr. M’membe wanting on this issue. I think on the 3bn US Dollars he missed the point or the research was short,” Mr. Mulenga said.
“If you begin examining the tax policy in Zambia, you will notice that our taxation is better than other countries. Now let’s look at what Dr M’membe talked about; are we giving away $3bn in mine taxes in Zambia? The question is, how did he arrive at that figure, what research did he conduct and who conducted that research? This is the biggest problem with some politicians in Zambia, who are only serving their selfish interest. Is the Socialist Party focusing on discrediting the Government on IMF loan for political mileage or doing checks and balances? Is this a political game of putting more numbers on your side or hardening Zambians to the extent that they demand for regime change? The general public would have wanted President M’membe to be asking how the Government intends to utilise the IMF loan facility,” Mr. Mulenga said.
“Alexander Nkosi has asked and I will be asking again. Is there $3bn lost in mine taxes in Zambia? If truly there is, then please we need him to help to recover that amount by reporting to the ZRA to investigate. This will be the prudent thing to do. By doing so, measures will then be put in place for this country to collect the lost income for the betterment of Zambia. The general public would want him to do this I think. From the look of things, the mine ministry together with their counterparts in the Finance ministry have been putting up very good policies to maximize revenue collection in the mines.
The question which Mr Bob Sichinga has asked is the question the general public expected Dr M’membe to have been asked. ‘’ What is it for, recurrent expenditure? Is it to reignite, stimulate the economy, and in what areas?”
Mr. Mulenga said the IMF loan facility would benefit Zambians if utilised on things like road construction.
“Renovating the road network could be one good economic stimulus the Government can look at. Roads in Zambia are one of the killing machines. So I feel investing in roads is not a bad idea. Zambians should not be cheated by cheap propaganda. What Zambians need is an improvement in the quality of living. This Government is on course and very soon Zambian will start seeing results of the efforts the government is making. We cannot judge them in a year; remember Rome was never built in a day or two. On the Copperbelt, we can see green lights already; there are positives in the mining sector worth pointing at. Again, I salute the Mines Minister Mr. Paul Kabuswe and the Provincial Minister Elisha Matambo for their efforts in facilitating meaningful development. Zambians will soon see why President Hakainde Hichilema appointed these young ministers in his cabinet,” Mr. Mulenga said.
