INCENTIVOS FISCALES EN LA MINERÍA: CÓMO MINIMIZAR LOS RIESGOS PARA LA RECAUDACIÓN

The document introduces a financial modeling framework designed to calculate the total loss of public revenue resulting from mining tax incentives. It distinguishes between 'direct costs' (the immediate loss of tax revenue) and 'behavioral costs' (revenue losses caused by investors adjusting their operations to maximize the benefit of incentives). The guide accompanies a beta financial model pre-configured for a medium-sized open-pit gold mine representative of Sub-Saharan Africa, following the FAST standard for transparency and adaptability. It details specific behavioral risks such as 'high-grading' in response to income tax exemptions, excessive interest deductions following withholding tax exemptions, and the under-invoicing of minerals under progressive royalty schemes. Additionally, it provides methodologies for testing cost estimates through scenario modeling and sensitivity analysis to determine if incentives are 'well-oriented'—meaning they provide more value when project viability is lowest.

• The total loss of revenue from tax incentives is the sum of direct costs and behavioral costs, where behavioral costs arise from investors modifying their actions to maximize financial benefits beyond government expectations.
• The IGF financial model is pre-configured for a medium-sized open-pit gold mine representative of Sub-Saharan Africa, using a typical tax and royalty regime.
• Combining multiple tax incentives can lead to higher revenue losses than the sum of individual costs due to interactions that erode the tax base, such as combining income tax exemptions with dividend withholding tax exemptions.
• Income tax exemptions can trigger 'high-grading' (increasing the cut-off grade to accelerate production), which can significantly increase the cost of the incentive; in one model example, high-grading nearly doubled the cost of a 10-year income tax exemption in real terms.
• Exemptions on withholding taxes for interest can lead to excessive interest deductions, where investors increase debt levels and interest rates to shift profits to low-tax jurisdictions.
• Progressive royalty schemes with a 'stacked structure' create 'dead zones' where buyers and sellers are incentivized to under-invoice mineral sales to keep the price at the upper threshold of a lower royalty bracket.
• Tax incentives are considered 'well-oriented' if their cost increases in the worst-case scenario (low prices/low performance) and decreases in the best-case scenario, as they then support marginal investment when most needed.

APA

Steel, I. (2018). INCENTIVOS FISCALES EN LA MINERÍA: CÓMO MINIMIZAR LOS RIESGOS PARA LA RECAUDACIÓN. International Institute for Sustainable Development. https://www.iisd.org/system/files/2025-05/tax-incentives-in-mining-minimising-risks-to-revenue-guidance-es.pdf

Chicago

Steel, Iain. INCENTIVOS FISCALES EN LA MINERÍA: CÓMO MINIMIZAR LOS RIESGOS PARA LA RECAUDACIÓN. International Institute for Sustainable Development, 2018. https://www.iisd.org/system/files/2025-05/tax-incentives-in-mining-minimising-risks-to-revenue-guidance-es.pdf.

Wikipedia

{{cite report |last1=Steel |first1=Iain |title=INCENTIVOS FISCALES EN LA MINERÍA: CÓMO MINIMIZAR LOS RIESGOS PARA LA RECAUDACIÓN |publisher=International Institute for Sustainable Development |date=2018 |url=https://www.iisd.org/system/files/2025-05/tax-incentives-in-mining-minimising-risks-to-revenue-guidance-es.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{steel2018incentivos, author = {Steel, Iain}, title = {{INCENTIVOS FISCALES EN LA MINERÍA: CÓMO MINIMIZAR LOS RIESGOS PARA LA RECAUDACIÓN}}, institution = {International Institute for Sustainable Development}, year = {2018}, url = {https://www.iisd.org/system/files/2025-05/tax-incentives-in-mining-minimising-risks-to-revenue-guidance-es.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }