Party leader, Kalaba, blows hot over reported mining incentives, claims $3 billion lost annually through tax avoidance

Citizens First (CF) party leader, Harry Kalaba, has criticised the government for granting mining companies “generous” incentives, including duty‑free equipment imports, Value Added Tax (VAT) refunds, and royalty deductions.

Kalaba alleged that these incentives had significantly reduced government revenue.

He cited April 2024 as an example, when mines paid about K1.8 billion in taxes, but after refunds the government retained only around K600 million.

“Nearly 70 percent of mining tax was returned after some months, leaving the country with very little actual revenue,” he said.

He added: “Research shows Zambia loses up to US$3 billion a year through mining tax avoidance, profit shifting, and exemptions.”

Kalaba pledged that the CF party, if in government, would revise tax breaks—not to deter investment but to secure fair returns for Zambians.

Read More: North-Western chiefs demand more share of royalties, taxes generated from minerals mined from their territories

By adjusting the mining fiscal regime to capture even a fraction more revenue, he said, Zambia could fund industrial parks for steel fabrication, agro-processing, and battery manufacturing.

“As long as we keep exporting raw materials without closing the financial leakages in the mining sector, other countries will continue to profit more from our resources than we do,” Kalaba stated.

He emphasized that real value lied in building industries to process and manufacture Zambia’s minerals, keeping wealth at home to benefit all citizens.

“By industrialising, we can turn our minerals into factories, jobs and national wealth. Zambia has the resources; what we lack is the leadership to use them effectively,” he added.

Kalaba further noted that in 2022, Zambia borrowed US$1.55 billion from the International Monetary Fund (IMF)—a sum he believes could have been covered by collecting just half of the revenue currently lost in the mining sector.

WARNING! All rights reserved. This material, and other digital content on this website, may not be reproduced, published, broadcast, rewritten or redistributed in whole or in part without prior express permission from ZAMBIA MONITOR.