Policy analyst and natural resource governance advocate Dr Steve Manteaw has cautioned that Ghana may have lost billions of cedis in potential mining revenue by postponing the introduction of a windfall tax in the sector. Speaking on Joy News’ PM Express on Monday, he said proposals for an extra profit tax in mining were made over a decade ago but were never implemented.
“The Act 703 was amended to allow the minister to prescribe the royalty rate for mining companies,” Dr Manteaw explained. “But in the absence of that prescription, the status quo remains — 5%, which companies have been paying all this while.”
He said the debate around mining royalties gained renewed attention during discussions over Ghana’s lithium agreements.
Dr Manteaw, a former member of the Ghana Extractive Industries Transparency Initiative, recalled that in 2012 the committee recommended a windfall tax for mining companies. “Such a tax ensures that resource-owning countries can claim a share of extraordinary profits when commodity prices surge,” he said.
He added that the proposal faced pushback from the mining industry at the time. “Gold prices were around $1,600, and the industry resisted, arguing it wasn’t the right time for an extra profit tax. So the proposal was put aside.”
While mining delayed such a mechanism, Dr Manteaw noted, the petroleum sector implemented a similar extra profit tax under the petroleum revenue framework, which has already generated revenue.
To address the absence of a windfall tax in mining, Ghana introduced a sliding-scale royalty system. “This system adjusts royalties based on commodity prices, sharing the benefits of a boom and mitigating risks when prices drop,” he explained.
However, he warned that the process of implementing the new royalty regime lacked adequate consultation. “Some stakeholders feel the price thresholds that determine royalty rates were not sufficiently discussed,” he said.
Dr Manteaw also noted that the regime may disproportionately affect smaller mining companies. “The three largest gold producers — Newmont, AngloGold, and Gold Fields — have stability agreements, so the new royalties don’t apply to them,” he said.
“This leaves smaller companies, including some Ghanaian-owned firms like ADAMUS Resources and Asante Gold, facing rates of up to 12%, which could pose operational challenges.”
Dr Manteaw emphasised the need for mechanisms that allow Ghana to capture additional revenue from commodity booms while ensuring fairness across the industry.
