Mining Companies dread monthly royalties payment

Mining Firms are expressing worries about plans to compel them to pay royalties monthly instead of every quarter.

The move is expected to take effect from this year if it receives the legal backing by the end of this year.

Chairman of Parliament's select committee on Energy and Mines, Ernest Yakah is reported to have explained the initiative is to facilitate access to funds by government for development projects in mining communities.

But Chief Executive of the Chamber of Mines, Dr. Tony Aubynn tells JOYBUSINESS, this will affect planning by mining companies.

It creates additional burden of bureaucracy and its has an impact on planning by mining firms because a company plans for four years schedules a quarterly payment into its programme. Therefore if the royalties payment is changed from quarterly to a monthly, it disturbs its plans” he noted.

“Even though we believe government has the prerogative to decide on when it would impose and take taxes, we thought for the purposes of best practices and convenience an annual payment would have been okay.” he added.

Mining firms currently pay five percent of their gross revenues as royalties to the state. Government in this year's budget increased corporate tax paid by mining firms to 35 percent and also plans imposing a 10 percent windfall tax on their profits

Story by Emmanuel Agyei / George Wiafe - Joy Business