Gemfields has been hit with a 21% tax burden in Zambia following the government’s decision to reintroduce a 15% export duty on emeralds, effective January 1, 2025. The duty, suspended in 2019 after negotiations with emerald producers, was reinstated this year, adding to the company’s existing 6% mineral royalty tax.
The move has prompted Gemfields to express concern, stating it was not consulted prior to the reintroduction of the duty. The company plans to engage with the Zambian government to seek the suspension or removal of the export tax.
The tax hike led to a 4.3% drop in Gemfields’ share price in London and a 12% decline in Johannesburg. The company’s Zambian subsidiary, Kagem Mining, previously paid 31% of its revenues to the government in royalties, taxes, and dividends.
Zambia, the world’s second-largest emerald producer, has introduced the duty as part of broader measures to boost government revenues, aiming for a GDP growth rate of 6.6% in 2025.
