Tancoal warns against introduction of road toll tax on coal

13Mar 2019
The Guardian Reporter
DAR ES SALAAM
The Guardian
Tancoal warns against introduction of road toll tax on coal

INTRODUCTION of a road tax of trucks transporting coal from Ngaka to clients in various parts of the country may increase the price of the commodity hence increasing costs of production on industries.

IEC’s Chairman, Graeme Robertson. 
The report further stated that among progress made during the period was winning a court case against National Bank of Commerce which was shown as both a contingent asset and contingent liability in the 2018 Annual Report. As part of the decision, Tancoal was awarded its counter claim against NBC for the return of US$230,000 that NBC had withdrawn from its bank account without authorisation. It is not yet known if NBC will appeal the decision. 

Intra Energy Corporation Limited which own Tancoal Resources Limited which is 30 percent owned by National Development Corporation said in its February 2019 production report that coal from Ngaka mines is normally transported by third parties while industries consume the product.

“Discussions continue with the Ministry of Minerals regarding the imposition of a road tax on coal transport, although this is not the responsibility of Tancoal and would increase production costs for the cement industry and restrict the export of coal,” said IEC’s Chairman, Graeme Robertson.

Robertson pointed out that Tancoal simply sells coal at stockpile and customers send their trucks to transport the coal so to apply road tax on Tancoal is not sensible. “Tancoal continues to support the government scheme for rapid industrialisation and does not want to see costs spiralling as a result of unfair imposts,” Robertson argued.  He however noted that during the month of February this year, production was down to 60,452 metric tons compared to 60,959MT produced in February 2018 although sales increased to 61,505 metric tons against 41,583MT during the same period.

“Production and sales in February was impacted by heavy rain and delays in arrival of ordered equipment,” the IEC Chairman added.

Australian based IEC which owns 70 percent of Tancoal Energy Limited further noted in its latest report that additional machinery expected in February has been delayed to March 2019 and will boost production capacity. Leases required to supply additional coal for increased production have not yet been released by the Ministry of Minerals. 

In another case involving Caspian Contractors, the company said the case has been postponed to 8 April 2019 as a new judge was appointed following the promotion of the previous judge.