Chamber advocates increases in mining royalties

The Ghana Chamber of Mines is advocating a policy to increase royalties returned by government to mining communities from nine percent to 30 percent.
 

The Chamber indicated that the increment should be tied to specific projects over a period of time.

Dr. Toni Aubynn, Chief Executive Officer (CEO) of the Ghana Chamber of Mines, disclosed this during an interaction with journalists in the Western Region at the Regional Press centre in Takoradi.

“Despite the declining gold price on the world market, the mining sector remains the highest contributor to Ghana Revenue Authority’s (GRA) domestic collections.”

The mining sector contributed about GH¢1.46billion to GRA, representing 27.04 percent of the Authority’s total direct tax in 2012.

The sector also paid an amount of GH¢893.77million in corporate tax to GRA in 2012, representing 36.98 percent of the total GRA tax collected within the period.

He indicated that mining companies returned about US$3.2billion, representing 73 percent of their mineral revenue through the Bank of Ghana (BoG) and the commercial banks in 2012 as against the statutory requirement of a minimum of 25 percent.

According to Dr. Aubynn, the sector voluntarily contributed about GH¢26million to its host communities and the general public, adding that the companies engaged 21,239 people directly out of which 334, representing two percent, were expatriate workers.

Dr. Aubynn said Ghana’s cash cost for gold production in 2012 was US$809 per ounce compared to the global average cash cost of 744 dollars per ounce.

“Global cost of gold production was up 11.4 percent from 1,079 dollars per ounce in 2011 to 1,202 dollars per ounce,” he said.

This, Dr. Aubynn explained, reflected a higher rate of increase in total cost of gold production relative to the appreciation in average gold price of 6.2 percent over the same period.

He called on government to encourage Ghanaians to invest in the mining sector.

Dr. Aubynn mentioned that most schools in the mining communities were either built or maintained by the mining companies; and that between 2006 and 2008 the mining industry contributed over US$3.5million to the country’s educational sector.