Conduct detailed analyses before scrapping VAT on mineral exploration – Tax analyst tells govt

The government has been cautioned in its attempts to revise the Value Added Tax (VAT) component on mining exploration.

This, according to tax analyst Francis Timore Boi, is imperative for the government as it makes efforts to meet its revenue target for the year.

The Minister for Lands and Natural Resources, Samuel Abu Jinapor, at the opening ceremony of the 2024 West African Mining and Power Conference and Exhibition (WAMPOC/WAMPEX) programme, disclosed that the government is reviewing the Value Added Tax (VAT) component of the tax build up on the cost of exploration for prospective mining companies.

While acknowledging the potential of the review of the VAT to attract more investment into the mining sector, Timore Boi emphasized the need for a comprehensive analysis to ensure proactive decision-making.

“I think it is a good thing. It will make exploration activities a bit affordable and possibly attract foreign direct investment into the mining industry.

“However, looking at the current situation where we [the government] need money, we need to weigh the options of whether we want to forgo that VAT, as this may cause some deficit to government coffers.”

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