Ideas for Improving Mineral Taxation in Latin America and the Caribbean

Mining represents one of the primary sources of revenue, tax receipts, sustainable development, and productive transformation for Latin America and the Caribbean. However, policies governing taxation within the mining sector are often inefficient and inequitable, thereby diminishing both investment and public revenue collection.

This report, developed in collaboration with the Inter-American Development Bank, presents a set of principles and proposals aimed at improving fiscal management within the region's mining sector.

• Recommends designing tax systems around efficiency, progressivity, and stability, ensuring that mining rents contribute to economic development without discouraging private investment.
• Calls for strengthening competitive and transparent bidding mechanisms for allocating mining rights, to maximize both extractive activity and public revenue while minimizing discretionary decision-making.
• Underscores the importance of royalty regimes and progressive profit-sharing schemes that automatically adjust to mineral price cycles, fostering greater fiscal stability and predictability for investors.

Collectively, these proposals seek to contribute to the modernization of fiscal institutions within the mining sector and to the construction of a tax framework capable of translating mineral wealth into sustainable and inclusive development for the region.