Zambia finance minister to outline position on sales tax soon

LUSAKA, July 17 (Reuters) - Zambia's new finance minister said on Wednesday he would soon give a clear position on replacing the country's value-added tax with a non-refundable sales tax. 

Since being appointed earlier this week, Bwalya Ng'andu has sought to mend fences with Zambia's mining industry. The proposed tax is a sore point between the government and mining companies in Africa's second-largest copper producer. 

"We intend to give a clear position within the next few weeks as to which way we are going on this one," Ng'andu said during a briefing on the country's economy. He had hinted when he was sworn in on Monday he might put off implementing the tax.

A committee would also examine the impact of a new tax regime on miners, he said. The country's Chamber of Mines has said it will stymie investment, push some producers into the red and hit production. 

The across-the-board 9% tax on sales of goods and services, originally due to be introduced in April, was intended to help rebalance Zambia's debt-laden economy. 

Ng'andu, who took over after his predecessor was suddenly sacked on Sunday, on Wednesday reaffirmed a target to reduce the deficit to 6.5% of gross domestic product from the current 7.5%. He said he would target savings of $500 million per year over the medium term by suspending some projects and cancelling others. 

The economic growth of 2% to 3% was expected in 2019 before increasing in 2020, he said.

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