Stakeholders within the mining industry have expressed their dissatisfaction with the recent announcement of new mining rates by the federal government, citing a lack of proper consultation. The Minister of Solid Minerals Development, Dele Alake, unveiled the increase in rates and charges for all sector activities on July 5. The purpose of this move was to position the sector for economic consolidation and to implement qualitative measures aimed at improving service levels, enhancing transaction traffic, and developing infrastructure.
The proposed new rates encompass an increase in charges for mining lease licenses and royalty rates for specific minerals, such as lithium, kunzite, and gold. The national president of the Miners Association of Nigeria (MAN), Dele Ayanleke, expressed discontent with these rates, citing lack of engagement in the decision-making process and the unsatisfactory state of the sector. Ayanleke particularly highlighted the issue of operators being subject to multiple taxation by state governments.
Prof Akinade Olatunji, the president of the Nigerian Mining and Geosciences Society (NMGS), acknowledged that it was not the review itself but the lack of consultation with relevant stakeholders that raised concerns. Olatunji stressed the need for the government to strengthen the Mines Inspectorate Division and to allow it to function effectively in order to prevent revenue leakage and increase government accrual.
The newly introduced rates pose a potential risk of significantly impacting stakeholders, as they will impose substantial financial burdens on mining operators. For instance, investors seeking a mining lease license will now incur a cost of N3 million, and Small Scale Mining Lease (SSML) applicants will pay N300,000 for the first two cadastral units. These revised charges have garnered the attention of many industry professionals.
The absence of proper consultation procedures can have far-reaching consequences and may lead to reduced revenue for the government in the long term. It is crucial for the government to engage with relevant stakeholders in devising solutions to the challenges faced by the mining sector. Failure to do so may ultimately cause more harm than good.
In conclusion, it is imperative for the government to address the concerns raised by stakeholders in the mining sector regarding the new rates. Proper consultation and engagement are essential for the smooth functioning of the industry. An inclusive approach will enable the government to optimize revenue generation and harness the full potential of the mining sector for the benefit of all parties involved.