Georgetown: The mining sector will benefit from a 10 per cent reduction in diesel taxes, which was recommended by Natural Resources and Environment Minister Robert Persaud and approved by Cabinet, on December 30, 2014, in recognition of the burden fuel prices have placed on the sector.
“The Cabinet … received a memorandum that was submitted by me making a recommendation that there will be a reduction of 10 per cent in taxes associated with fuel, primarily and only diesel in this regard,” the Minister announced during his meeting with the Guyana Gold and Diamond Miners Association (GGDMA) on Tuesday.
He said a letter was dispatched to GGDMA President Patrick Harding in which Government acknowledged it granted a 10 per cent reduction in the taxes associated with the purchase of fuel for use in the mining sector, but only through the GGDMA Trading Inc.
Minister Persaud noted that this significant reduction in the taxes would result in miners saving millions of dollars annually. “This, I think, and you will agree, with the substantial intervention and relief for the sector…and the savings to the mining sector would be millions of dollars annually.”
The Minister explained that reducing the cost of fuel would also reduce the cost of production both substantially and immediately and the impact would be felt as an encouragement to the sector.
GGDMA President Harding hopes the tremendous savings, which will result from the tax reductions will greatly assist the miners in increasing and improving their operations.
He acknowledged that it was a good move for the industry and should benefit approximately 15,000 persons who are directly employed and over 100,000 who are indirectly employed.
Harding also highlighted the falling price of fuels on the global market and hoped the entire public could soon benefit from the massive reductions.
“We haven’t seen that price passed on to the public, not only the miners but to the public and we’re hoping that price, hopefully, it’s passed on.”
With regard to plans for 2015, Harding said he was aiming to achieve lower costs of production in the industry.
The Ministry has, throughout the previous year, intervened in the mining sector to help cushion the impact of the plummeting global prices for gold.
Concessions, tax reductions and waivers, and duty-free access were offered to the mining sector in light of low gold prices.
Gold prices
Nevertheless, the Minister pointed out that the gold prices were slowly moving upwards, signalling a positive indication for the sector once again.
The GGDMA President was also optimistic about this revelation and hoped the prices would continue to increase.
Given the strategic importance of gold to the economy, the Minister said the Government would continue to provide support wherever it would to reach out to the sector to ensure its survival and continued growth and contribution to national development.
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