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Mining Tax, Royalties

New Tariffs Effective This Year

The 2018 Finance Law vulgarizes the tariffs in the Mining Code that was enacted by the President of the Republic on December 14, 2016. 

 

The 2018 Finance Law of the Republic of Cameroon has given the greenlight for the implementation of tariffs contained in the Mining Code. The tariffs relating to mining royalties, taxes and custom duty fixed by the Mining Code that was enacted on December 14, 2016 by the President of the Republic, has as from January 1, 2018 gone into effect. Article 239 of the 2018 Finance Law states that “the rates of duties, taxes and mining royalties are those fixed by the Mining Code.”

Part VIII of the Mining Code defines the tax, customs and economic provisions in the mining sector. Mining royalties, value-based royalties, area-based royalties and extraction tax as well as customs duties have been identified in Sections 171, 173, 174 and 175 of the Code with specific tariffs. Section 176 of the Mining Code clarifies that rates and tariffs of fixed duties, area-based royalties, the ad valorem tax and extraction tax laid down in the above mentioned sections of the Code shall be incorporated into the Finance Law and attached as annex to the General Tax Code. The two legal instruments are therefore in tandem with one another as far as mining tax, royalties and duties are concerned. 

The amounts however vary from one mining activity to the other. In obtaining quarry licenses for instance, FCFA 1.5 million is expected for the license to be granted and FCFA 2 million for renewal. A quarry permit grant warrants FCFA 2 million, FCFA 2.5 million for renewal and FCFA 3 million for transfer. As far as non-industrial mining operator’s card is concerned, FCFA 10,000 is required for a grant while FCFA 20,000 is needed for renewal. Meanwhile, a non-industrial mining license grant is worth FCFA 30,000 and FCFA 50,000 for renewal. The Code holds that the minimum charge for annual mining concession permit shall be FCFA 2 million for small-scale mining and FCFA 4 million for industrial mining. 

As for Value-based royalty ( ad valorem tax on mining substances and extraction tax on quarry materials), it shall be paid month by mining permit holders or during shipment of consignments  by mining license holders upon filling out a tax returns at the taxation authority. Ad valorem tax is calculated on the basis of the taxable value of ready-to-ship products extracted from mine.

 

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