Local authorities of Kwale, Lamu and Taita Taveta located along the coastal areas of Kenya have proposed to levy new mining taxes, despite opposition from central government.
According to the Indian Ocean counties, the taxes would be imposed on investors exploiting minerals, gas and oil, with an aim to improving services and creating jobs in the region, reported Reuters.
Kwale country governor Salim Mvurya told the news agency that: “We want these mining companies to help us develop our county’s social and economic infrastructure…We hope they will cooperate when the bill is passed.”
However, the Kenyan Government fears that the addition of taxes would deter those who plan to invest in the country.
Kenya mining minister Najib Balala said: “It is our responsibility as the mining ministry at the national level to increase royalties in the mining sector.
“Mining is a function of the national government and the constitution is very clear on this.”
The bill proposed by Mvurya states that mining firms with more than 50 employees have to pay $11,220 a year to conduct business, while firms with fewer than 50 employees would pay $754.
In addition, it proposed that mining firms such as Australia’s Base Resources would pay $56 a tonne for mining titanium ore.
Base Resources external affairs manager Simon Wall said: “Certain functions are not devolved to counties.
“The constitution determines how the administration of minerals must be treated.”
The bill is expected to be presented before the county assembly by next week.