Zimbabwean lithium producers are pressing the government to review taxes and allowable deductions, arguing that the fiscal burden is adding to operating costs as volatile prices and uncertain demand complicate investment decisions, Mining Zimbabwe can report.
By Ryan Chigoche
The concerns come as Zimbabwe pushes miners to process more lithium locally before the January 2027 deadline for spodumene concentrate exports, requiring companies to weigh investment in processing plants against operating costs and statutory obligations.
Producers say the tax regime is adding to that pressure. Export taxes and levies are not deductible when calculating corporate income tax, a treatment that PLZ argues increases its overall tax burden and reduces the cash available for operations and further investment.
Speaking during the recently concluded Minerals Marketing Corporation of Zimbabwe (MMCZ) lithium media tour at the PLZ mine, the company’s public relations manager, Patience Chizodza, said the current arrangement amounted to double taxation.
“Currently, we are paying 10% export tax and 3% export levy, which are not included in the deductible expenses for corporate income tax assessments. This accounting treatment creates an accumulated tax burden, driving the effective tax rate to about 16% and leading to unintended double taxation,” Chizodza said.
PLZ wants the Ministry of Finance to allow the export charges to be deducted when calculating corporate income tax. The company has also called for a clearer tax base, greater policy stability and adjustments to the value-addition framework, with its proposals submitted through industry bodies.
The company has raised similar concerns before. In an earlier report, Mining Zimbabwe detailed PLZ’s calculation that the 10% export tax and 3% levy, when followed by corporate income tax on those non-deductible charges, produce a combined burden of about 16.25%. This is the company’s calculation of the cumulative effect of the charges, not a uniform effective tax rate across the lithium industry.
While PLZ has focused on how export charges are treated in tax assessments, Bikita Minerals has called for a broader review of the obligations facing producers as they navigate an uncertain market.
Bikita Minerals acting general manager Thomas Mufumi said volatile lithium prices, uncertain demand and the working capital needed to sustain operations were placing pressure on producers. He said a review of tax obligations and applicable deductions would help companies maintain operations and continue investing during periods of market weakness.
“Lithium prices are volatile, demand is uncertain, and the working capital requirements are significant,” Mufumi said. “A review of the tax obligations and deductions affecting the industry would help producers sustain operations and continue investing.”
The government’s tax policy is tied to its push to retain more value from lithium production within Zimbabwe. Under the 2026 National Budget, a 10% export tax applies to lithium ore and concentrate, while lithium sulphate was assigned a zero rate, reflecting the incentive for companies to process the mineral locally rather than export it in less-processed forms.
That leaves the government balancing revenue collection and its beneficiation ambitions against producers’ calls for a tax framework that allows them to fund operations and new processing capacity. The Ministry of Finance’s response to the industry’s proposals will determine whether any changes are made.
