Base Resources is in talks with the Kenyan Treasury and KRA to settle issues regarding refunds [Photo/Twitter]
The Government has collected Sh400 million over the past year in royalties from mineral sands trade in Kwale County, Base Titanium has said.
Base Titanium which has been separating and sending out minerals in the Kenyan coast says it had paid $4 million in the course of the year.
The firm dispatches 2.5 percent of its incomes from the selling of mineral sands, for example, zircon, rutile and ilmenite to Government as payments.
The mineral sands are essential elements of titanium oxide and utilized as a base color in paint and the making of pottery while also aiding in the production of titanium.
Joe Schwarz general administrator for external affairs and development at Base Titanium said there is speculation that the costs of the mineral sands would increase in the coming months, which would increase the sum paid to Government. Development in costs is relied upon to be driven by high demand from China.
"The amount of royalties that goes to the Government will go up with increase in prices," said Schwarz as reported by The Standard.
"There are increasing signs of an emerging supply deficit and there is an expectation that mainstream contracted rutile prices will experience upward momentum through the second half of 2017. Spot prices of rutile increased sharply through the quarter (to June), with prices in China increasing by over 30 per cent," he added.
There have been recommendations to raise royalties paid to Government, from the current 2.5% to somewhere between five and ten percent.
Schwarz says that the firm has been getting general installments from KRA yet the sum has not been enough to settle the discounts claimed by Base Titanium.
He stated that the cash owed by the Kenyan revenue authority had in the past helped the firms overcome cash flow setbacks however they have managed to deal with the issue internally.