Friday, September 29, 2023

Taxes on Minerals Used in US Electric Vehicles

In an effort to balance the production and consumption of critical minerals, a radical change in US mining policy is being considered.

A Historic Paradigm Shift in Mining

As investigated by REDIMIN in the article published by, a federal committee has proposed the imposition of royalties on hard rock mining in the US, this is the first time that such a step has been considered. This initiative has the main objective of increasing the national mineral production, providing more funds to the agencies in charge of issuing new mining permits.

The Impact on the Electric Vehicle Industry

One of the sectors that will be most affected is the electric vehicle industry. Materials such as lithium, cobalt and nickel are essential for their production, and this is at the heart of the reform proposal, which is central to President Joe Biden’s climate agenda plan.

Reform the Old System

In a 168-page report, the Interinstitutional Working Group on Mining Laws, Regulations and Permits proposed a profound reform of the General Mining Law of 1872. This law, which has been in force for more than a century, allows free and open exploration of federal mineral deposits.

The proposal is not only limited to the implementation of royalties from 4% and 8%, but also promotes the change to a system of leasing federal lands for mining purposes. In addition, it is suggested that mining claimants be encouraged to develop their claims in a timely manner, increasing rates over time.

Leveling the Industry with other Sectors

These changes seek to put the mining industry on the same terms as other sectors, such as oil, gas and coal. The additional funding will strengthen the agency’s staff, expedite mining permits, better engage with local communities, and protect taxpayers from the costs associated with cleaning up abandoned mines. .

Community Outreach and Involvement

An official of the Interior Department emphasized the importance of this proposal by mentioning that by accepting the same rules in other sectors, it will improve the public perception of the mining industry. In addition, if a community or state receives some of the revenue from this proposal, it can reduce opposition or provide funding to address some of the issues that cause opposition.

An Interdisciplinary Committee

It is worth mentioning that the committee that proposed these changes was led by the Department of the Interior and included representatives from various government entities, which shows the seriousness and breadth of the analysis carried out.

Nation World News Desk
Nation World News Desk
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