Exclusive-Peru’s Castillo wants mining companies to accept “prudential” tax changes, consultants say Reuters

Marco Aquino

Lima (Reuters)-A senior adviser told Reuters on Tuesday that the Peruvian Socialist President-elect expects that mining companies that enjoy high metal prices will be enlisted in a “cautious” plan to raise taxes on mineral resources.

In one sign, there is no gap between the business sector in the world. The No. 2 producer and the incoming left-wing government are about to shut down. Castillo’s economic adviser, Pedro Francke, said that after dozens of meetings with companies, he does not expect the company to oppose the plan. Review of tax rules.

After reviewing the votes cast on June 6, Castillo will be confirmed as president. This political novice and former teacher disturbed the Peruvian elite. They planned to redraft the constitution and significantly increase the taxation of miners. He once said that he “pirated” the country’s wealth.

But as he approaches power, Castillo has eased his remarks, and Frank has also tried to calm market concerns. He told Reuters that he had held dozens of virtual meetings with domestic and foreign investors and some mining industry business leaders in recent weeks.

“In general, a good dialogue has been established and a large part of their concerns have been eliminated. I think there is a lot of openness,” he said by phone.

Frank said: “If you proceed with caution, the mining sector is not closed to the new revisions to the tax system,” he added, adding that given the high global metal prices, people he spoke to thought these plans were “reasonable.”

The Peruvian Chamber of Mines could not immediately comment.

Frank added that he believes it is important to be careful not to “strangle” mining incentives and to ensure that the funds raised are fully utilized. Castillo has previously talked about imposing a tax of up to 70% on mining profits.

Castillo also proposed to review contracts with mining companies that lock in tax rates for a long time. Frank said that he plans to negotiate with these companies, and any agreement will “strictly depend on the acceptance of these companies.”

Peru has signed such agreements with six mining companies, including China MMG Co., Ltd., Aluminum Corporation of China and Anglo-American (LON:), the company’s Peru copper mine project will go online in 2022.

Frank stated that Castillo is willing to talk to business leaders and will respect his commitments, including the protection of private property and private investment.

Castillo leads the right-wing Fujimori Keiko with about 44,000 votes, but the results of the second round of elections have not yet been formally confirmed, and the election authorities review the controversial votes after Fujimori challenged.