HARARE
–
The
High
Court
has
ruled
that
Zimbabwe
Platinum
Mines
(Zimplats),
the
local
unit
of
South
Africa’s
Impala
Platinum
(Implats),
is
not
liable
to
pay
mining
royalties
on
matte
and
concentrate
exported
between
June
2018
and
December
2021,
delivering
a
major
blow
to
the
Zimbabwe
Revenue
Authority
(ZIMRA).
Justice
Rodgers
Manyangadze
ruled
that
the
Finance
Act,
as
it
stood
before
amendments
that
took
effect
on
January
1,
2022,
drew
a
clear
legal
distinction
between
“minerals”
and
“mineral-bearing
products”,
and
did
not
prescribe
royalty
rates
for
intermediate
products
such
as
matte
and
concentrate.
ZIMRA
had
assessed
Zimplats
for
alleged
royalty
shortfalls
amounting
to
ZWL2.03
billion,
or
about
US$7.1
million,
arguing
that
royalties
should
have
been
calculated
on
the
gross
market
value
of
the
final
refined
mineral,
without
deductions
for
beneficiation
or
processing.
But
the
court
rejected
that
approach,
holding
that
no
lawful
royalty
obligation
could
arise
in
the
absence
of
a
clearly
fixed
rate
for
mineral-bearing
products
during
the
period
in
question.
“The
Finance
Act…
does
not
provide
calculation
for
mineral-bearing
products.
It
only
provides
calculation
for
minerals,”
Justice
Manyangadze
said,
adding
that
matte
and
concentrate
“cannot
attract
the
same
royalties
as
minerals
that
have
gone
through
the
refinery
process.”
The
judge
placed
decisive
reliance
on
the
Supreme
Court
ruling
in
ZIMRA
v
ZIMASCO
(SC
79/13),
which
held
that
chrome
ore
concentrates
and
ferrochrome
were
not
subject
to
royalties
before
January
2022
because
no
rates
had
been
prescribed
for
mineral-bearing
products.
That
decision,
the
court
said,
was
“on
all
fours”
with
the
Zimplats
dispute.
“In
matters
of
taxation
and
fiscal
obligations,
it
is
a
fundamental
principle
that
no
tax
or
royalty
can
be
imposed
without
clear
and
express
statutory
authority,”
the
Supreme
Court
held
in
the
ZIMASCO
case,
a
principle
Justice
Manyangadze
said
was
binding
on
the
High
Court.
ZIMRA
had
sought
to
rely
on
a
2025
amendment
to
the
Finance
Act
that
retrospectively
expanded
the
definition
of
“mineral”
to
include
mineral-bearing
products
dating
back
to
2010.
However,
the
court
ruled
that
definitions
alone
cannot
create
a
tax
obligation,
warning
that
retrospective
amendments
cannot
cure
the
absence
of
a
charging
provision.
“As
no
rate
had
been
fixed
for
such
products
in
the
Schedule
at
the
relevant
time,
the
retrospective
amendment
cannot
impose
an
obligation
that
did
not
previously
exist,”
the
court
said,
echoing
the
Supreme
Court’s
reasoning.
The
court
granted
Zimplats
the
main
declaratory
relief
it
sought,
confirming
that
it
owed
no
royalties
on
matte
and
concentrate
sold
to
Impala
Platinum
during
the
disputed
period.
As
a
result,
ZIMRA’s
assessed
shortfalls
and
related
penalties
fall
away.
Zimplats
was
represented
by
Advocate
Thabani
Mpofu,
while
ZIMRA
was
represented
by
Samuel
Banda.