As state governments across the nation look towards the implementation of more taxes to augment allocation from the Federal Government, Vice President Yemi Osibanjo on a contrary note has urged them to tread with ease especially with imposing more taxes in the Mining Industry.
With the knowledge that most states across the federation are looking towards exploring the mining sector in their states by attracting foreign investors due to the heavy presence of mineral resources, he warned against activities that could do the opposite of discouraging these investors.
He, therefore, highlights illegal fees, taxes, and levies on licensed mining companies as a disincentive to prospective investors in the sector which negatively impacts the Federal Government’s efforts to expand the mining industry.
Buttressing his diagnosis, the Vice President deems it easy to fall into the temptation of imposing more taxes on foreign and local licensed companies and operators all in the bid to shore up resources which creates an advert effect of scaring away these investors.
Due to the nature of desperation by these state governments, he explained that in some cases, enforcement agencies across the states are reported to frequently arrest and harass these licensed miners and their workers leading to the closure of the mining sites.
More factors affecting economic growth through the mining sector
The VP with the experience of chairing the presidential economic team in the recently held maiden edition of the strategic engagement on sustainable mining titled: ‘Resurrecting our Buried Prosperity’ took time to explore all other challenges against the mining sector.
In his analysis, policy formulation ranks the highest as factors slowing down the growth rate of the mining sector not forgetting the spate of insecurity in resource-rich communities as rival groups struggle to control access.
In his words,
Then, there are the huge security concerns that always develop in the struggle for the control of mineral resources in poorly regulated, unregulated, or ungoverned spaces.
Almost invariably, these situations lead to criminal activities and particularly, the proliferation of weapons and armed groups. This is true historically and more evident now.
Drawing the curtain on analysis of issues affecting the mining sector, the Vice President encourages the need to embrace collaboration and harmonization between the Federal Government, states, and resource-rich communities.
According to him
It is for these reasons that this strategic engagement with the leadership of the 774 local governments is critical.