TBoth SMEs and the mining sector are complaining about the higher costs they will have to pay. Small and medium-sized enterprises say that this “leaves out the engine of the economy,” while mining companies argue that it reduces their competitiveness.
Tax modification “affects mining competitiveness”
Mining will experience a cost increase due to the reduction of the credit associated with the specific diesel tax for non-transport companies. With this measure, the Treasury expects to raise US$135 million, of which 74% will be financed by the mining sector, according to the Mining Council.
“This tax is intended to compensate for the use of public roads, which mining machinery does not use. In fact, all land transportation used by our sector already pays the corresponding specific tax. The current bill distorts this logic. (…) This surprising measure adds to the one implemented by the previous government to finance electricity bills for regulated customers, in which mining also assumed, without justification, a significant portion of the amount involved,” said the association’s president, Joaquín Villarino. “It is not equitable to alter a tax to selectively burden strategic sectors, affecting their competitiveness,” he added.
Juan Cristóbal Ciudad, from Plusmining, explained that the modification implies that around 69% of the specific diesel tax would become an effective cost, translating into a direct increase in mining companies’ operating costs. The most affected operations would be open-pit mines, which involve longer hauling distances.
Source:El Mercurio