GDI gets five-year tax exemption

GREAT Dyke Investments (GDI), which is developing a platinum mining project in Darwendale, Mashonaland West province, has been granted a five-year tax exemption by the Government.

The mining entity is a joint venture between Russia’s Vi Holdings and Zimbabwe’s Landela Mining Venture (Pvt) Limited and is investing US$3 billion into the platinum project.

According to a Government Gazette Extraordinary dated January 27, 2021, Finance and Economic Development Minister Professor Mthuli Ncube, granted the exemption in terms of the Income Tax Act (Chapter 23:06).

“This notice may be cited as the Income Tax (exemption from income tax) (Great Dyke Investments (Private) Limited notice, 2021.

“The notice is deemed to have come into effect from the 1st of January, 2020.

“The receipts and accruals of Great Dyke Investments (Private) Limited, as per the Special Mining Lease Agreement signed between the Government of Zimbabwe and Great Dyke Investments (Private) Limited are approved,” reads part of the notice.

It outlines that the consequence of the approval is that the receipts and accruals of GDI are exempt from: “Income tax for a period of five years commencing from the date of receipt of income from mining operations and sales of mining output; and resident shareholders’ tax payable on dividends paid to shareholders of Great Dyke Investments (Private) Limited residents in Zimbabwe in connection with special mining lease operations of Great Dyke Investments (Private) Limited; and in addition profits tax for a period of five years commencing from the date of receipt of income from mining operations and sales of output payable in respect of the special mining lease area for any year of assessment.”

Recently, GDI announced that the African Export-Import Bank (AfreximBank) completed a due diligence study for the platinum project paving way for the regional financier to proceed with a US$500 million syndicated funding programme.

The mining firms has also said the first phase of the new platinum mine on the Darwendale concessions was on course.

Towards the end of last year, GDI announced that over US$25 million had been spent in the development of the mines and a total of US$110 million had been invested.

Under the first phase, GDI is expected to develop two mines, a concentrator, engineering workshops, storerooms, staff change rooms, portal offices and fuel storage.-herald.clz.w