Insights on Incentives: Tax competition in mining

Resource-rich countries compete to attract mining investment but run the risk of offering poorly designed tax incentives.

The use of poorly designed tax holidays in mining leads countries to forgo vital revenues in exchange for unknown benefits—revenues that are needed to fund public services and infrastructure.

This paper highlights key findings from an analysis of the IGF Mining Tax Incentives Database, a collection of files comparing the fiscal regimes of 104 mining projects across 21 countries.

The database is the first large-scale, systematic attempt to compile tax incentives used by developing country governments to attract mining investment. It is also the first public effort to bring together incentives granted in mining contracts.

This is made possible through greater contract transparency—in particular, the availability of resource contracts compiled by the Natural Resource Governance Institute (NRGI), Columbia Center on Sustainable Investment (CCSI), the World Bank and Open Oil.