Economy, Business And Markets

Gov’t to Cut Mining Royalties

Gov’t to Cut Mining RoyaltiesGov’t to Cut Mining Royalties

The government will soon reduce the rate of mining royalties imposed on iron ore mines, Tasnim News Agency quoted Minister of Industry, Mine, and Trade, Mohammad-Reza Nematzadeh as saying on Sunday.

Mine royalties became the subject of a heated debate among industrialists in the mining sector as the parliament passed a law last year which required mines to pay up to 25% of the value of their extractions as mining usufruct fees. Certain incentives were granted to iron ore mines however, as they will be given discounts if they manage to process iron ore into raw materials for steel, including iron ore concentrate, iron ore pellet and sponge iron. It was agreed that the mining usufruct fee will decrease to 21.5% if the iron ore producer processes iron ore into concentrate, while the figure will further decrease to 18% if the concentrate is processed further and is turned into iron ore pellet.

The parliament has also allowed the mining firms to pay only a 15% in mining usufruct fee if they continue the process and produce sponge iron – the input for a steel plant.