• Zimbabwe’s artisanal miners now produce 77% of the country’s gold but pay only 1.5% royalty and no other taxes
• Large-scale miners producing 23% face 10% royalty plus full corporate tax, PAYE and levies an inverted and unsustainable fiscal regime
• A uniform 10% royalty would add at least $86–150 million per year to the Treasury, more than doubling revenue from the artisanal sector without disrupting deliveries

Harare- 

Zimbabwe is experiencing one of the most remarkable gold production surges in its history, achieving a record 36.48 tonnes in 2024 after a dip to 30.1 tonnes in 2023, with 2025 now firmly on track to deliver between 44 and 47 tonnes and export earnings of at least $3.2 billion, possibly much higher.

Gold export revenues have risen dramatically over recent years: $1.6 billion in 2021 from 29.6 tonnes, $2 billion in 2022 from 35.46 tonnes, $1.8 billion in 2023, and a record $2.5 billion in 2024 from 36.48 tonnes. Gold prices have, for the first time ever, remained sustainably above $4,000 per ounce, pushing gold to account for more than 50% of total export receipts and nearly 60% of all foreign currency inflows into the country.

The undisputed driver of this boom is the artisanal and small-scale mining (ASSM) sector, which contributed 65% of total output in 2024 and has risen to 77% in the first nine months of 2025, while large-scale miners (LSM) have fallen to only 23%.

Yet the current fiscal regime is completely inverted and economically indefensible. ASSM pay a stagnant 1–2% royalty (effectively 1.5% on average) and nothing else, no corporate tax, no PAYE, no environmental levies, no community development funds, no export levies. Large-scale miners, by contrast, pay 5% royalty, on top of full corporate income tax at 24.72%, PAYE on thousands of employees, NSSA contributions, environmental rehabilitation provisions, community trusts, and numerous other statutory payments.

It makes no economic sense whatsoever to charge the untaxed, informal ASSM only 1.5–2% while hammering the fully compliant formal sector with an effective burden that can exceed 40% of revenue.

The entire mining sector recorded gross revenues of $4.948 billion in 2023 and $5.495 billion in 2024, yet contributed only $671 million and $747 million respectively to the national fiscus, an effective tax-and-royalty rate of just 14%. This embarrassingly low capture exists solely because the 65–77% of production coming from ASSM escapes with virtually no fiscal contribution.

That era of lost opportunity is now ending. In a bold move announced in the 2026 National Budget on November 27, 2025, Finance Minister Mthuli Ncube proposed harmonizing royalties across the board: a tiered structure of 3% for gold prices up to $1,200/oz, 5% between $1,201–$2,500/oz, and 10% above $2,501/oz, applicable to all gold producers, both ASSM and LSM alike.

With prices hovering above $4,000/oz throughout 2025 (peaking at $4,381 in October), this immediately triggers the full 10% rate for everyone, eliminating the arbitrage that let ASSM pay a fraction while LSM bore the brunt.

This policy directly reclaims the hundreds of millions squandered in prior years: recalculating 2021–2024 at 10% (instead of ASSM's 1.5% and LSM's 5%) would have generated an extra $486 million for the treasury over four years alone, more than tripling the $216 million actually collected.

Using the confirmed minimum $3.2 billion gold export earnings for 2025 and the 77%/23% split recorded so far, the impact is transformative. Under the old regime (ASSM 1.5% + LSM 10%), ASSM would deliver $2.464 billion and pay only $37 million in royalties, while LSM would deliver $736 million and pay $73.6 million, meaning the sector producing 77% of the gold contributes less than the 23%.

Now, at a uniform 10% across the board, the government will collect $246.4 million from ASSM and $73.6 million from LSM, totalling $320 million, an instant 191% increase that captures fair value from the boom's true engine.

Historical data reflects the reclamation: In 2021 ASSM delivered $960 million worth of gold and paid $14.4 million at 1.5%; at 10% they would have paid $96 million, an extra $81.6 million. In 2022 they delivered $1.4 billion and paid $21 million; at 10% this would have been $140 million, an extra $119 million.

In 2023 the figure was $1.134 billion against $17 million actual; at 10% it would have been $113.4 million, an extra $96.4 million. In 2024 ASSM delivered $1.625 billion and paid $24.4 million; at 10% the treasury would have received $162.5 million, an extra $138.1 million. Over these four years, the uniform 10% would have added a staggering $435.1 million from ASSM alone, transforming the fiscus and funding infrastructure, health, and education during the windfall.

While this harmonisation is a welcome correction, finally taxing the 77% of output that previously escaped, it must be holistic to avoid overburdening LSM, who already contribute far beyond royalties through formal jobs, skills transfer, beneficiation, and a web of taxes that ASSM largely evades.

The 10% rate, though price-responsive and aligned with global trends (e.g., Ghana's 5–6% caps, Tanzania's tiered systems, and Peru's progressive models), risks deterring investment in LSM if not balanced with relief elsewhere, such as restoring 100% upfront capital deductions or easing the 30% retention that still drives diversions.

Miners' federations have already warned that 10% could spur smuggling if official channels aren't sweetened with at least incentives for ASSM.

The concerns are not theoretical. Caledonia Mining Corporation, operator of the Blanket Mine, Zimbabwe's second largest gold mine, has publicly stated that the proposed 10% royalty hike would likely reduce profitability and cash generation at Blanket relative to current market expectations, potentially straining returns on its planned $484 million Bilboes Gold Project.

Caledonia, which has maintained a long-standing presence in Zimbabwe, emphasized ongoing constructive engagement with authorities but highlighted the cumulative impact of the royalty increase alongside changes to capital expenditure tax treatments, which could delay upfront deductions and further pressure near-term cash flows.

Shares in the company dipped over 4% following the announcement, reflecting investor unease about margins in a high-cost environment where all-in sustaining costs (AISC) have already climbed to record levels globally, driven partly by rising royalties and input inflation.

Yet, from a global perspective, Zimbabwe's 10% rate at elevated prices is far from outlier status and aligns with international norms for resource-rich nations seeking to capture windfall gains. In Indonesia, a major gold producer, royalties can reach 10% for large-scale operations under its contract-of-work system, with small-scale miners facing similar rates plus additional levies.

Australia's Western Australia imposes up to 7.5% on gold royalties but effectively higher through state-specific taxes, while Nevada in the U.S. levies a net proceeds tax that can exceed 5–10% depending on margins. Ghana, Africa's second-largest producer, caps royalties at 6% but has introduced price-escalator clauses that push effective rates higher during booms, much like Zimbabwe's tiered model.

These benchmarks suggest the 10% is a calibrated response to prices above $4,000/oz, levels unseen before 2025, ensuring the state shares in the rally without pricing out viable operations, as evidenced by sustained production in comparator jurisdictions.

The policy's harmonisation also levels the field for ASSM, whose informal structure previously shielded them from scrutiny, potentially boosting compliance and reducing the $1.2 billion smuggling drain.

The government itself enables ASSM operations through mining titles and security; it can now enforce the 10% via tax clearance at Fidelity, geofencing claims with drones and satellites, and providing low-cost drilling and environmental support to keep deliveries flowing. For LSM, complementary measures, like reducing corporate tax to 20% or exempting exploration costs would ensure the policy sustains both sectors.

The current pre-harmonisation regime was unsustainable as it captured nothing from ASSM's dominance while overtaxing LSM and starved the fiscus during the greatest boom ever. The new 10% uniformity addresses these head-on, reclaiming lost billions and aligning tax with production shares.

Unless implemented holistically, with incentives for compliance and relief for LSM's broader burdens, Zimbabwe risks repeating past mistakes. But if balanced right, this policy turns the tide: a uniform 10% royalty, collected automatically and paired with genuine support, could deliver $300–$400 million annually at current levels without disrupting the deliveries powering record output.

The mathematics are undeniable, the global precedents clear. Zimbabwe has a narrow window to make this fiscal reckoning truly equitable, ensuring its greatest gold boom benefits the nation, not just the fortunate few.

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