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Tax concerns prompt Vedanta to halt Nchanga copper mine ops in Zambia

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Tax concerns prompt Vedanta to halt Nchanga copper mine ops in Zambia

Vedanta Resources PLC's Konkola Copper Mines PLC unit halted operations at its Nchanga mine in Zambia after the government imposed a 5% import duty on copper concentrates, Reuters reported Jan. 5.

In a note to employees seen by the newswire, Konkola said the mine would be suspended from Jan. 4 due to the low availability of acid as a result of downsizing at the Nchanga smelter.

The duty has made smelting of imported concentrates commercially unviable, the company said.

Aiming to reduce debt, Zambia has introduced new mining duties, increased royalties and plans to replace the value-added tax with a sales tax by April. Miners have opposed the move, warning that it may lead to about 21,000 job losses and US$500 million in capital expenditure cuts over the next three years.

The government had asked mining companies to provide details on the impact of the higher taxes, but said none of them did so before the December 2018 deadline.