Chile Senate Approves Increase of Mining Royalty

17 October 2010 (Last Updated October 17th, 2010 18:30)

Chile's Senate has approved a revised bill to increase royalties of mining companies to help fund post-earthquake reconstruction. The bill, which initially sets the royalty at 4-9% and gradually raises it to 5-14% from 2018, is required to be passed in the lower house, where a commission

Chile's Senate has approved a revised bill to increase royalties of mining companies to help fund post-earthquake reconstruction.

The bill, which initially sets the royalty at 4-9% and gradually raises it to 5-14% from 2018, is required to be passed in the lower house, where a commission has already approved the legislation.

Mining companies pay a royalty of 4-5%.

The government aims to raise $1bn over the next three years through the increase of royalty to pay for reconstruction after a massive earthquake in February.

However, the royalty rule does not apply to companies that are covered under a 12-year tax invariability clause signed in 2005, reports Reuters.