mining-tax-policy-covid-19-key-points-es-3cf59ff80292475f.pdf

This fact sheet provides guidance for decision-makers on designing mining tax relief policies in response to the COVID-19 pandemic, emphasizing efficiency, strict eligibility criteria, and conditional support to ensure state aid reaches the most vulnerable operations without benefiting profitable entities.

• Governments should determine whether tax relief is applied to the entire mining sector or only to the most affected companies based on whether the crisis impacts the sector uniformly. Priority for relief should be given to existing mines rather than new investments, and benefits must be granted to the local company registered in the source country rather than foreign parent entities.
• Eligibility for government aid should be restricted to companies demonstrating severe financial distress that threatens operations and employment. Indicators of such distress include negative project cash flows for over one year, sharp declines in mineral market prices, inability to meet tax obligations, quarantine-related closures, or risk of significant layoffs. Companies that paid dividends in 2020 are disqualified from receiving relief.
• State financial assistance should be conditional upon specific corporate behaviors, including maintaining employees at normal salaries, freezing or postponing executive bonuses and salary increases, canceling shareholder dividends (excluding government shares), abandoning artificial tax avoidance schemes, and adopting transparent, fair pricing and benchmark practices.
• Recommended short-term tax relief options include the deferral or temporary exemption of payroll taxes, accelerating VAT credit refunds (or applying a 0% rate), exempting import duties on health-related equipment and essential inputs, and allowing immediate deductions or credits for health-related capital expenditures. Royalty exemptions are suggested only as a last resort for projects facing viability threats, potentially in exchange for increased state equity or as debts to be repaid.
• The document advises against providing income tax exemptions, as profitable companies capable of paying such taxes do not require relief. It also recommends maintaining withholding taxes on non-residents, particularly for developing countries with limited administrative resources, though exceptions for third-party debt may be considered.

APA

International Institute for Sustainable Development (n.d.). mining-tax-policy-covid-19-key-points-es-3cf59ff80292475f.pdf. https://www.iisd.org/system/files/publications/mining-tax-policy-covid-19-key-points-es.pdf

Chicago

International Institute for Sustainable Development. mining-tax-policy-covid-19-key-points-es-3cf59ff80292475f.pdf. n.d. https://www.iisd.org/system/files/publications/mining-tax-policy-covid-19-key-points-es.pdf.

Wikipedia

{{cite report |author=International Institute for Sustainable Development |title=mining-tax-policy-covid-19-key-points-es-3cf59ff80292475f.pdf |url=https://www.iisd.org/system/files/publications/mining-tax-policy-covid-19-key-points-es.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{internationalinstituteforsustainabledevelopmentndminingtaxpolicycovid19keypointses3cf59ff80292475fpdf, author = {{International Institute for Sustainable Development}}, title = {{mining-tax-policy-covid-19-key-points-es-3cf59ff80292475f.pdf}}, institution = {International Institute for Sustainable Development}, url = {https://www.iisd.org/system/files/publications/mining-tax-policy-covid-19-key-points-es.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }