Mining revenue fell 43.6% so far this year

In a year where the weakest economic growth in two decades is expected – not counting the pandemic – and with little room for public spending, tax collection from economic activities continues to fall.

At the end of August, the total of tax revenue fell 11.7%registering the most pronounced fall in mining and hydrocarbons (-43.4%), according to data from the Sunat. The agricultural, fishing, construction and commerce sectors are also in decline (see infographic).

Less is captured, but it continues to be produced

In detail, the decline is greater in the mining subsector (-47.6%), although, for economist Epifanio Baca, it is strange to find a reason for the lower collection of resources for the treasury in one of the most important sectors in the country. , since, until July, the production of the extractive industry rose 10.01% —and, since last year, up to 13.35% only in metal mining.

“There is no explanation why the Income tax (IR) has fallen so much. Neither the prices of copper that remain above 3.5 dollars (an ounce) nor the production volume have been altered. The drop in revenue is not reasonable,” he assured this newspaper.

For his part, the former vice minister of Environmental Management, José de Echave, alleges that the lower price of zinc, the regularizations of the third category IR compared to last year and the increase in the cost of inputs generate a cocktail that gives rise to lower mining revenues. , which translates into a lower delivery of resources to the regions.

In addition, according to CooperAcción, the payment of Income Tax on mining, including regularization, decreased by 62.4% in the accumulated amount until the seventh month in interannual terms. The IR of the mining sector represented 14.8% of the total collected and in terms of participation, barely 10.2%. In both indicators it is lower than the previous year.

The net contribution of mining to the country totaled S/8,252 million, 50% less than what was seen in July 2022, when it reached S/15,861 million.

Specialists remember that lower collection affects the resources that the regions receive for the extractive activity. According to data from the Ministry of Energy and Mines (Minem), S/6,877 million were transferred until July, 30% less than what was seen in the same period in 2022.

Baca warns that the macroeconomic scenario is inauspicious, since “the fall in private investment and consumption is alarming”; while De Echave maintains that the main problem is tax pressure – 15.6% of GDP, far from 22% in Brazil or 21% in Chile – but it was not debated when prices reached historic peaks despite suggestions.

More details of the tax deterioration

In non-tax income, the decrease was 27.4% compared to the accumulated January-August 2022. To summarize, in mining royalties the increase was 2.5%, but they decreased in Law 29788 royalties (-25%) and special tax on mining (-69.5%). And, in the Special Tax on Mining, the decline was 32.5%. In terms of tax refunds, in mining and hydrocarbons The contraction was 1.5%, but only in mining did it rebound 23.1%.

Historically, mining taxation has been key for the country when mineral prices are on the rise —recalls De Echave—, as in 2007, when the contribution of the item in IR was 50%, and of the total taxes, 25%. %. “When prices do not rise, it is not as significant, but it is still key for economic variables,” he said.

The word

Epifanio Baca, economist

“Neither copper prices nor production volumes have been altered. The drop in revenue is not reasonable […]. Stage macroeconomic “With a fall in private investment it is alarming.”