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Mining firms asked to honor the 1% own-revenue allocation for community projects

Leaders  in  Taita-Taveta County have stated that firms engaged in mining activities in the region must give back a
percentage of their gross revenue to the local communities whose land is being exploited.

Speaking  in  Wundanyi on Sunday, area MP, Danson Mwashako  said that the Mining Act 2016 directed firms doing
mining activities set aside a minimum of one percent of their revenues which would go towards uplifting the communities.

The MP was responding to former Machakos Senator, Johnstone Muthama  whose mining company, Rockland Kenya Limited, has moved to court to challenge the requirement of allocating one percent of their earning to community development projects.

“In  fact, one percent is the minimum. These firms should and will pay more to the communities who own the land,” said  the MP.

He  noted that the Parliament was waiting for finalization of the Community Development Agreement (CDA) regulations  of  2017 for the law to take effect.

Rockland  Kenya Limited, a gemstone mining firm, had asked the court to suspend several clauses of mining act and CDA until the case lodged is heard and determined.

The  firm argued that it is already complying with all tax requirement and pays its statutory demands on time. The firm  faulted the requirement to pay one percent of its yearly revenue, stating that the development project it was to undertake were duties of both the national and county government.

The  firm  further argued it was operating inside Tsavo National Park and had paid all the necessary fees to Kenya Wildlife  Service (KWS) pointing out there was no human settlement within a radius of 45 kilometers.

However, Mwashako  said the regulations to give back to the society were very manageable, noting the companies should  pay  more.

He  added that the one percent was for annual revenue by mining companies and insisted the money was needed in the  communities.

According  to the Mining  Act, mining firms should pay 70 per cent of their royalties to national government, 20 per cent  to  county government and 10 per cent to communities living around a given mining area.

The  firms  are  also required to set aside at least one per cent of their revenues for development projects in the mining areas.

The  county  is  home to several mining companies engaged in mining of gemstones, iron ore and manganese.

By  Wagema  Mwangi

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