Zambia’s main opposition party, The Patriotic Front, has urged the government to scrap its proposed new tax regime for the mining sector because its likely to hurt growth in the recovering sector, local media quoted PF President Michael Sata as saying over the weekend.

Sata, was quoted by the independent Post newspaper as saying that the decision of government to implement the tax regime effective April 1 is likely to put jobs at risk and threaten future expansion plans by mining companies.

The PF is the most popular political party in Zambia’s mining regions, having won 18 seats out of the 20 in the Copper Belt during 2006 parliamentary elections.

The Zambian parliament has already approved new tax proposals for the mining sector which include a windfall tax and government is ready to implement the new regime effective April 1. However, mining companies are threatening to seek legal redress over the issue.

The Post further reported that Finance Minister Ng’andu Magande challenged the PF to hold rallies in Zambia’s copper-rich northern region to explain how the new tax regime will affect the sector.

“Zambia is one of the most respected democratic states in Africa and an attractive investment destination. However, recent government tax proposals for the mining sector are outrageous and you do not expect the opposition to just sit back when the country’s leading sector is being threatened,” a mining executive in Zambia told Dow Jones Newswires in a telephone interview Monday.

Government officials say the new regime will not hurt the sector because it will increase the total mining tax rate to 49% from 31%.

The companies say new regime will hike tax rates for the sector to 75% which is likely to make mining unviable.

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