Zambia's large mineral reserves are its richest natural endowment. Copper mining is the main source of foreign exchange earnings and an essential part of the country's developmental plans. This paper, based on a series of public discussions held in 2010, highlights public concern over how much Zambia really benefits from its copper wealth, and calls for the mining tax regime to be reformed to collect more revenue.

• Zambia's mining tax regime is strongly focused on attracting foreign investment through low rates and an assortment of incentives. But this needs to be balanced with the urgent need to raise more revenue from mining in order to invest in infrastructure and the country's economic development. The optimal balance between these two objectives has not yet been struck. It is time for the Government to devise a strategy for all Zambians to participate in the benefits from their country's mineral reserves.
• The revenue-based windfall tax, repealed in 2009, is a simpler way to tax windfalls than the existing variable profit tax, which has not yet delivered any revenue. Had it remained in force, the windfall tax could have contributed many hundreds of billions of kwacha to government coffers. Given the limited capacity of the Zambian authorities to assess mining companies' claims on profitability levels, the windfall tax should be re-introduced, at least until such a time that Zambia is able to administer a profitsbased tax effectively.
• Mining companies should not be allowed to offset hedging transactions against income. Fixing this loophole would be a simple and effective measure to raise revenue and should be one of Government's first moves.
• It is crucial that those who bear the brunt of mining's social and environmental impacts see a fairer distribution of mineral royalties. Mining operations take a toll on the local infrastructure and fuel rapid urbanization, so the local administrations need specific support to address these challenges.
• Public discontent is fuelled by the secrecy of government relations with mining companies, dating back to the Development Agreements which have never been publicly disclosed. It is imperative that the Government and mining companies subscribe to international best practice in extractive industry transparency.