Poll: 74% of Chileans want mining companies to pay higher taxes

 

Poll: 74% of Chileans want mining companies to pay higher taxes

A vast majority of Chileans, 74% to be exact, believe mining companies should pay higher taxes and that those funds should be allocated to the regions where mining operations are based, reveals a survey conducted by pollster MORI and the country’s Catholic University.

The study, conducted between late January and mid-February this year among almost 1,500 individuals, also shows that most Chileans (67%) don’t know whether miners fulfill their environmental responsibilities, reports La Nación (in Spanish).

Global miners operating in Chile, the world’s top copper producer, have grown uneasy with the new government’s proposed changes to the current foreign-investment law, which calls for the removal of a provision favourable to overseas companies.

Under the so-called DL 600, firms that bring capital, physical goods and other forms of investment into the country can ask to sign a foreign-investment contract with the government. The regulation includes a specific clause for the mining sector, applicable to projects worth at least US$50 million, which grants investors a fixed corporate income-tax rate for 10 years.

But mining minister Aurora Williams has said the government is evaluating new investment incentives for companies and that those already operating under the DL 600 system will be allowed to keep their current contracts.

First carbon tax in South America

Another point of contention is newly elected President Michelle Bachelet’s plans of charging thermal power plants with a generation capacity of at least 50 megawatts a tax of $5 per metric ton of carbon dioxide emitted.

The issue is that  80% of Chile's energy, especially copper mines, is based on imported fossil fuels, such as coal and oil.

Chile's new environmental minister, Pablo Badenier, said he expected the new tax to force power companies to change their projects towards less polluting systems.

"These companies can incorporate technologies to reduce pollutants or simply change the fuel they use," he said to local media. 

 "Once you have the taxation in place, you open a range of possibilities to reduce emissions," he added.

The red metal accounts for 60% of Chile's exports and 15% of gross domestic product.