Lima, Aug. 01 (ANDINA). Peruvian Finance Minister Luis Miguel Castilla said Monday that the government is advancing in talks with mining companies on how best to increase taxes without affecting the sector's competitiveness.
"It is an important topic that requires a quick resolution," Castilla said in an interview with Radio Programas.
President Ollanta Humala took office on July 28 with promises to raise taxes on mining companies, which have been posting strong profits, thanks to record metals prices.
Investors have expressed concern that the initiative could affect planned investments of $42.5 billion in the sector this decade.
Members of Humala's Gana Peru party began discussions with the National Mining, Oil and Energy Society, or SNMPE, before the new government took office, Castilla said.
"We are now in a technical phase and defining the different formulas to be able to reach the objectives that we have as a country," he was quoted as saying by Dow Jones Newswires.
The government plans to use resources from the new tax to finance public works in areas that do not receive a regional mining tax. Half the income tax paid by mining companies goes to the governments of the regions in which they operate.
Mining companies contribute millions of dollars as a result of the tax every year, although about 80% of the funds are distributed to only eight of Peru's 24 regions, Castilla said. "It's going to be a tax regime that maximizes the state's resources, but without compromising the future of important investment projects," he added.
