Government plans to cancel excise duty exemptions for Tanzanian mining companies will force massive restructuring at a significant cost to the economy, warned a private miners’ group.

The Tanzania Chamber of Minerals and Energy said that the measures, which include stopping fuel levies and imposing excise duties, were regressive, local newspapers reported.

Last week’s new budget proposed to abolish the long-standing tax breaks for the industry to increase the state revenues, according to a report in Mineweb.

The group said the measures would increase operating costs for firms and have negative knock-on effects for state revenues.

The government is reported to have completed a review of the existing mining policy and is set to introduce a new mining law in 2009 or 2010, according to Reuters.