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Government Imposes U$200 Levy on Refined Gold Exports, Bans Export of Unrefined Gold

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The government has introduced a new statutory instrument imposing a levy of U$200 per kilogram of refined gold for export. Additionally, the government has banned the export of non-refined gold.

A new statute that levies a $200 fee per kilogramme of refined gold intended for export has been proposed by the government. Furthermore, the export of unrefined gold has been outlawed by the government.

The Mining and Minerals (Export of Refined Gold) Regulations 2024 became effective on May 24, 2024, after the Minister responsible for mineral development published them in the gazette.

This came after two meetings between the Gold Refiners Exporters and Dealers Association, represented by their lawyers, the Kampala Associated Advocates (KAA), and President Yoweri Museveni about the sector’s future.

The newly gazetted instrument comes at a time when the previous statutory regulation expired on June 30, 2023. Unlike its predecessor, the new law mandates that all exported gold must meet an international purity standard of 99.9%.

This measure aims to ensure value addition within the mining industry, aligning with Uganda’s broader policy on enhancing the value of its natural resources.

Uganda is rich in essential mineral resources, which could drive its transition to a green economy. The country possesses large deposits of gold, uranium, limestone, marble, graphite, iron, copper, and cobalt, among others.

While these minerals significantly boosted Uganda’s economy in the 1950s and 1960s, contributing up to 35% of export earnings, the mining sector’s contribution has now dropped to below 3%.

In 2021, the sector accounted for 2.3% of Uganda’s GDP, according to the Ministry of Finance.

This decline is partly due to the export of unprocessed minerals, the prevalence of artisanal miners, especially in gold mining areas like Buhweju and Mubende, as well as the influence of foreigners, government insiders, illegal miners, and smugglers.

In December last year, the Minister of Energy and Mineral Development, Ruth Nankabirwa, signed a new regulation setting higher purity standards for tin exports.

This initiative backs President Museveni’s directive to stop exporting unprocessed minerals, including tin.

The new regulation raises the minimum purity level for tin exports to 99.85%, up from the previous range of 67% to 70%. This is expected to significantly impact Uganda’s tin mining and processing industry.

Industry experts view this development as a positive step towards improving the quality and marketability of Ugandan minerals on the global stage. By prohibiting the export of non-refined gold and enforcing strict purity standards, the government intends to maximize the economic benefits derived from its mineral wealth.

The imposition of the levy and the enforcement of stringent standards are expected to incentivize local refining, thereby creating jobs and fostering technological advancement within the sector.

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