It is emerging that the introduction of the sliding scale mineral royalty regime in the large-scale mining sector is not enough, as the Ghana Extractive Industries Transparency Initiative (GHEITI) is pushing for a similar framework to be introduced in Ghana’s small-scale mining sector.
GHEITI says extending the sliding-scale royalty model to small-scale miners could play a crucial role in bringing thousands of operators into the formal tax and royalty-paying system while creating a more supportive business environment for indigenous mining enterprises.
In its latest press statement on the country’s new mineral royalty regime, GHEITI argued that the current policy conversation has largely focused on large mining companies, even though small-scale mining contributes significantly to Ghana’s gold output and rural livelihoods.
The transparency initiative believes that applying a reduced and flexible royalty structure to the small-scale mining sector would help address long-standing challenges in the industry, which particularly include widespread informality and weak compliance with tax and royalty obligations.
“The Minister for Lands and Natural Resources should also consider introducing a reduced mineral royalty regime for small-scale miners, to get them into the tax/royalty-paying pool, while at the same time creating a necessary favourable business climate for such indigenous businesses,” the press release from GHEITI indicated.
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Under the newly introduced sliding-scale royalty regime for large-scale mining, royalty payments are tied to gold prices, allowing the state to capture more revenue when prices rise while easing the burden on companies during periods of lower commodity prices.
GHEITI believes a similar principle, adapted to the realities of small-scale mining, could create the right balance between revenue generation for the state and sustainability for local operators.
For many years, thousands of small-scale miners have often operated outside the formal system, partly because regulatory costs and tax obligations are perceived to be too burdensome relative to their scale of operations.
GHEITI insists that a tailored sliding-scale royalty structure could therefore make compliance more attractive and practical.
By lowering barriers to formal participation, GHEITI believes the government could significantly expand the number of small-scale miners contributing to public revenue while strengthening oversight and accountability in the sector.
This proposal aligns with broader national efforts to transform small-scale mining into a more organised and environmentally responsible industry.
