23 January, 2012
The major trade union at KGHM Polska Miedź SA, the ICEM-affiliated Miners’ and Energy Workers’ Section of NSZZ Solidarność, announced last week it would protest against the Polish government’s draft legislation to impose an unusually high minerals tax on the partially state-owned copper and silver company.
The union, along with one of the smaller unions at KGHM, the ZZ Copper Industry Workers’ Association (ZZPPM), are now conducting procedural measures among workers at some 30 enterprises, including KGHM’s three mines, two refineries and smelters, a rolling mill, wire rod plant, and other workplaces in order to lawfully carry out the protests. Manifestations could come as early as this week.
The actions are in response to the 17 January draft bill put forward by Poland’s Finance Ministry to the Parliament to place a high minerals tax on KGHM. The proposed tax, only on copper and silver, would impose a minimum of 0.5% on the average price of copper, up to a maximum of ZL16,000-per-tonne (€4,000).
The government is looking at the tax as a means to patch deficits in the country’s budget.
Jósef Czyzcerski
“The tax is extremely high compared to taxes in other copper extracting companies,” said NSZZ Solidarność in a statement. The union’s leader at KGHM, Jósef Czyzcerski, said the tax would drain the company of its profitability, thus severely restricting investment and development, and ultimately costing jobs. He said the tax could eat away a full 90% of the company’s profits.
The unions at KGHM also oppose the fact that the minerals tax is singly aimed at KGHM. Czyzcerski said the Finance Ministry failed to conduct proper public consultations before approving the draft bill and submitting it to Parliament.
KGHM is 32% owned by the Poland’s Treasury Ministry and the unions fought bitterly in the recent past as the government gradually reduced its stake in the company. KGHM employs 18,000 workers and is the world’s ninth largest copper company and third biggest producer of silver. The company is based in Lubin, Poland, in the country’s copper basin of Lower Silesia.