The Minister of Information, Mr Lai Mohammed, has revealed that the federal government will slash the allocation of states where registered mining companies are taxed by both local and state governments.
This followed a memo (containing the challenges in the mining sector) presented to the Federal Executive Council by the Minister of Mines and Steel Development, Lekan Adegbite.
Mr Adegbite noted that the challenge of double taxation was pushing investors out of the country.
Mr. Mohammed who briefed journalists after the meeting said the council has directed the Minister of Finance, Budget, and National Planning, Zainab Ahmed, to deduct directly from the Federation Account’s allocation to states which have deprived the federal government revenue due to illegal taxes and levies on mining companies.
“In other words, if a particular state engages in double taxation, you are imposing illegal taxes on a duly registered mining company, and it is reported to the government, the Ministry of Finance will deduct that money from your allocation.
“The intent is to ensure that we don’t scare away investors, be they local or foreign. This will go a long way to reassure the investors that Nigeria is a safe place to invest now.
“But at the end of the day, what the council approved for him and which we believe will be far-reaching and really reposition the industry is that: the council noted that insecurity and illegal mining had led to a huge loss of money.
“But the council directed that the National Security Adviser (NSA) should set up a special unit domiciled in the Federal Capital Territory (FCT), Abuja, and coordinated by the Office of National Security Adviser (ONSA) to carry out targeted operations at identified and confirmed illegal mining sites nationwide.
“The council also directed the Office of National Security Adviser to facilitate the erection of central magazines (special storage facilities) across the geo-political zones of the country for mining purposes as storage of explosives in military barracks in some parts of the country is grossly unsafe and the establishment of Control and Command Centre for remote monitoring of such explosives.
“The council also directed the Minister of Interior and the Nigerian Content Development Board to work closely with the Honorable Minister of Mines and Steel Development.”
Recall that during 2020 Mining Week which held virtually, Mr Adegbite outlined some of the challenges the mining sector was facing.
The minister said insecurity in certain parts of the country was part of the challenges facing the ministry.
The Minister, during the virtual session, said:
“Notably, in the North-Western part of the country, mining has been suspended because of the activities of bandits and kidnappers.
“The industry is also faced with the problem of collusion between some stakeholders, sometimes the traditional rulers.”
“Before now, the position is that any miner that wants to use explosives for mining must store them in either the military barracks or police facilities.”
Mr Adegbite has now asked for special dispensation to build special facilities for storage of explosives at least one in each of the six geo-political zones of the country.