March 19, 2019 / 1:32 PM / 2 months ago

Ahead of election, Polish lawmakers propose to cut copper tax

FILE PHOTO: Molten copper is poured at the KGHM copper and precious metals smelter processing plant in Glogow May 10, 2013. REUTERS/Peter Andrews

WARSAW (Reuters) - Lawmakers from Poland’s ruling Law and Justice (PiS) party proposed on Tuesday to cut mining tax payments so that major copper producer KGHM could spend more money on investment.

The mining levy, introduced in 2012 and calculated using a formula based on local production volumes and prices, primarily affects KGHM, a major employer in southeast Poland and one of the world’s biggest copper and silver producers.

Poland holds general election this year. The tax has been a subject of debate during previous campaigns. In 2015, some politicians had promised to scrap it.

KGHM paid 1.67 billion zlotys ($442 million) in mining tax in 2018, while the group’s profit were 1.66 billion zlotys.

“Lowering the mining levy by 15 percent ... will make additional funds available to KGHM, which will significantly translate into long-term stability and development of the company,” lawmakers said in draft law published on parliament’s website.

Reducing the mining levy would lower budget revenues by an estimated 180 million zlotys in 2019 and 240 million zlotys in subsequent years, the draft said.

By 1310 GMT shares in KGHM had risen by 4.2 percent.

Reporting by Pawel Florkiewicz; Editing by Agnieszka Barteczko and Edmund Blair

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