Government has cut royalties for artisanal small scale (ASM) miners from three percentage points to one percentage point for the first 500 grams of the precious yellow metal per month, as it seeks to encourage deliveries to Fidelity Printers and Refiners (FPR).
According to a notice in the Government Gazette, Government announced that the reduction of royalties, duty and fees for the precious yellow metal to small scale gold miners would be back dated to 1 February.
“It is hereby notified that the Minister of Finance and Economic Development, has amended by the repeal of paragraph 1 of the Schedule to Chapter VII of the Finance Act.
“.. paragraph 1 (which fixes the rates of royalties for the purposes of section 245 of the Mines and Minerals Act [Chapter 21:05] of the items on gold produced by small scale miners and substitution of the following items;
“Gold produced by small scale gold miners 1 percent (for the first 0.5kgs of gold delivered to a holder of a gold dealing licence in a calendar month).
“1% (if the gold is delivered by a holder of a gold buying agency permit to a holder of a gold dealing licence in a calendar month).
“Gold produced by small scale gold miners 2 percent (if the gold delivered to a holder of a gold dealing licence in a calendar month exceeds 0.5kgs).”
Previously, royalties for gold that exceeded 0.5 kgs was fixed at three percentage points.
Ministry of Mines and Mining Development has reported that gold worth at least $1.2 billion is illegally exported from the country every year, hence this move would ensure that gold deliveries are rechanneled towards the formal market, thru FRP, the sole official gold buyer in the country.