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Mines ministry seeks review of gold royalty proposal

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GWERU — The Mines ministry has approached Treasury to reduce royalties on gold deliveries up to one kilogramme in a bid to support small-scale producers, an official has said.

In his 2014 budget statement, Finance minister Patrick Chinamasa lowered the rate of royalty from 7% to 3% for small-scale gold producers whose output does not exceed 0,5kg per month. However, Mines deputy minister Fred Moyo said this threshold should be raised to include miners who produce up to a kilogramme per month.

“Generally, we are all happy with the budget statement, but as a ministry we feel there is need to revise the quantum where we feel half a kilogram is too little,” Moyo said, adding there were also other aspects of the budget that were under review.

The 2014 budget is set to be debated when Parliament resumes sitting this week. In his budget presentation, Chinamasa laid out a series of measures targeted at small-scale producers, but critics have warned that artisanal miners have no capacity to lift Zimbabwe’s gold output back to record levels recorded in the late 1990s, when annual output reached 27 tonnes, about twice the current production.

The ministry’s Mining Industry Loan Fund was allocated $460 000 in the 2014 budget and Moyo said part of the money would go towards capitalising small-scale miners.

The mining sector is expected to expand by 11,4% in 2014, having grown by 6,5% in 2013 against projections of 17,1%.

— The Source

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