Mining Taxation – Fondation pour les Etudes et Recherches sur le Développement International (FERDI)
The Ferdi will update the legal and tax database country by country. It estimates that the average time needed to update a country is four days. However, it goes without saying that countries that have made major tax reforms will require more time than countries whose laws have not changed. For example, Burkina Faso, which passed a new Tax Code, and the Democratic Republic of the Congo, which passed a new Mining Act, will require more time than Benin, which has not a priori substantially changed its tax legislation. Updating each country requires four tasks:
- Search for texts. This first step requires an average of one day to search for new legal texts posted on various websites (Ministry of Mines, Chamber of Mines, Ministry of Economy and Finance, Revenue Authority, official gazette, Extractive Industries Transparency Initiative, Faolex, Droit-Afrique, etc.). This time is fixed, regardless of the number of new texts found. It is not possible to know in advance how many new acts or regulations have been adopted in 2017 and 2018. In general, countries adopt at least one Finance Act per year, but it is possible that countries have modified or replaced their Income Tax Act, their Minerals and Mining Act or other tax acts or regulations. In addition to the number of texts, the availability of texts also varies greatly according to the country: some texts will be easy to find, while other will not be found on the internet.
- Text analysis. This second step requires an average of one and a half day to read the new texts and to extract the information concerning solely mining taxation. The time required varies according to the number of texts found, the length of these texts and the importance of the tax reforms they contain. The new Income Tax Acts or new Minerals and Mining Acts are the longest to deal with as they radically reform a country’s legislation.
- Web integration. This third step requires an average of one day to update the database on the website (add new texts, new legal quotes, new tax rates, etc.). The time required includes a fixed part and a variable part depending on the number of texts found and the importance of the tax reforms.
- Calculation of the indicators. This fourth step requires an average of half a day to update the model and calculate the new indicators about the sharing of mineral resource rent for 2017 and 2018. The time required is mainly fixed.