Finance Minister Felix Mlusu on Monday clarified that the K3.5 billion carbon tax levy collected in the 2020/21 financial year was channelled towards climate change management activities at the Ministry of Forestry.
Natural Resources Committee of Parliament Chairperson Werani Chilenga has been pressing the government to account for the funds, claiming that he had information that the Ministry of Natural Resources was yet to access the funds.
Mlusu said the balance, as well as the funds collected to date, would be ring-fenced, as agreed between the Treasury and the Ministry of Natural Resources.
“The Ministry of Natural Resources is still carrying out activities of the carbon levy. The money is not intact because we have been funding the activities the ministry is carrying out. There could be a balance depending on how much has been used,” he said
Chilenga, however, said the funds had not been used for their intended purpose as agreed with stakeholders involved in the matter.
“What he was saying is like the carbon tax levy is used to increase the tax base collection into Account Number One. That money is not supposed to be used for normal funding. It is supposed to go straight into the account of climate change management which was created,” he said
Chilenga said the committee would continue with its plans to summon Ministry of Finance officials to account for the funds.
The government introduced a carbon levy on fuel consumption to support the implementation of measures to mitigate the effects of climate change for resilience so that it could attain the goal of carbon neutrality by 2050.
It is estimated that K3 billion would be realised every year from this levy.