Professional services firm, PwC, is warning of a potential decrease in the expansion of the extractive sector as a result of the Growth and Sustainability Levy to 3% from 1%.
It is also advising that the non-deductible levy will raise operating costs and reduce profits of firms in the extractive sector.
In its critique of the 2025 Budget, it said consideration should therefore be given to companies with stability clauses, exempting them from the levy.
The increase in the Growth and Sustainability Levy is to ensure that the nation benefits from the windfall in gold prices and secures its fair share of mineral royalties.
PwC urged the government to review these agreements to increase its fiscal take, aligning with its revenue mobilisation goals.
“Engaging the Chamber of Mines is very crucial to finding a win-win solution. Offering incentives to attract investment in exploration and production could enhance gold production which ultimately may pay more royalties and dividend to the government”, it added.
It also urged the government to consider having a framework around windfall taxes to help mining companies plan and forecast.
According to PwC, this system will ensure that the government receives a fair share of profits during periods of high commodity prices.
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