Mines begin receiving VAT refunds

Government has resumed paying value-added-tax (VAT) refunds to mining companies, putting an end to a long running dispute.

Mines Minister Christopher Yaluma told Reuters on the sidelines of the Zambia Mining Investment Forum in London that government is very committed to repaying the VAT refunds.

Mr Yaluma said government had started paying to clear the debacle.

Vedanta’s chief executive Tom Albanese, a delegate at the event, confirmed that the government had resumed some payments.

Mr Albanese told Reuters on the sidelines of the conference in London that government is beginning to pay back on invoices post February 2015 on a case by case basis.

A source at another mining firm, who declined to be named because he was not authorised to speak to the media, also said the Zambian government had started some VAT refund payments, although small.

Mining companies had claimed for months that they were owed more than $600 million in VAT refunds and in February the government decided to relax the rule requiring exporters to produce import-export documents to claim the refunds.