Chile greenlights mining tax reform that reinforces authorities take


© Reuters. FILE PHOTO: A view of BHP Billiton’s Escondida, the world’s largest copper mine, in Antofagasta, northern Chile March 31, 2008. REUTERS/Ivan Alvarado/File Photograph



By Fabian Cambero

SANTIAGO (Reuters) -Lawmakers in Chile’s decrease home of Congress gave ultimate approval on Wednesday for a long-awaited mining tax reform that now requires solely the signature of leftist President Gabriel Boric, who has publicly backed it, to develop into legislation.

The reform would require massive and lithium producers that function within the mineral-rich Latin American nation to pay extra taxes and royalties to the federal government.

Chile is the world’s high copper producer and No. 2 in lithium, each seen as key to creating future fleets of electrical autos powered by rechargeable batteries.

By a vote of 101 in favor to 24 in opposition to, lawmakers accredited modifications to the tax and royalty invoice endorsed by the Senate final week.

The lopsided vote was hailed by Finance Minister Mario Marcel, who underscored that the upper authorities take required of mining corporations would tackle previous abuses.

“With this laws, we search to keep away from what occurred many instances with our nation’s pure riches: they had been exploited, they disappeared, which left little or no for the nation and its future improvement,” Marcel informed reporters after the vote.

Below the reform, the highest tax price will attain as much as almost 47% for corporations that produce over 80,000 tonnes of wonderful copper a yr, thought-about excessive by the {industry}.

It additionally establishes a 1% advert valorem tax on copper gross sales from corporations that promote greater than 50,000 tonnes of wonderful copper, in addition to a further 8% to 26% tax relying on the miner’s working margin. 

Mining affiliation Sonami expressed aid that the measure ended uncertainty over the kind of reform lawmakers would finally undertake.

“Uncertainty lasted for nearly 5 years and, indisputably, harm the nation’s primary productive exercise,” Sonami stated in a press release.

The affiliation described the ultimate legislative language as “higher” than what was initially proposed by the federal government, giving credit score to Marcel for enacting industry-friendly revisions.