Tax Aspects of the Venezuelan Mining Law

The Organic Mining Law, published in Official Gazette No. 7,020 (Extraordinary) dated April 16, 2026 (the “Mining Law”), establishes a new legal framework for mining activities in Venezuela, aimed at promoting both domestic and foreign private investment under a more predictable legal framework.

From a tax perspective, the Mining Law introduces a more flexible, contract-based Government Take model, primarily based on royalties, a gross revenue-based mining tax, contributions to the National Mining Fund, and a broad set of exemptions and tax relief measures.

I. Royalties

• A royalty of up to 13% on gross production is established, calculated on the commercial value of the final product, payable in cash or in kind.
• The applicable royalty rate will be determined by the Ministry with authority over mining, based on technical, economic, environmental, and social factors.

II. Mining Tax

• A mining tax of up to 6% on monthly gross production is introduced, with no deductions permitted.
• The applicable rate will be determined by the Ministry with authority over mining, within the limits set forth in the Mining Law, considering, among other factors, the nature of the project, the type of mineral, and the required level of investment.
• The Ministry will also determine the phase of mining operations from which the tax becomes applicable, in accordance with the relevant mining contract.

III. National Mining Fund

• The Law creates a National Mining Fund aimed at financing social and economic projects in areas affected by mining activities.
• Operators are required to contribute up to: (i) 1% of gross production in concession agreements; (ii) 1% of gross profits in mixed companies; and (iii) 0.5% in small- and medium-scale mining operations.
• These contributions are creditable against royalty payments.

IV. Incentives and Exemptions.

• The Law provides exemptions from the High-Net-Worth Tax and certain parafiscal contributions (including science and technology (LOCTI), sports, anti-drug, and pension contributions).
• Mining activities are not subject to state or municipal taxes, effectively centralizing the tax burden at the national level.
• The social responsibility commitments set forth under the Public Procurement Law are not applicable.

V. Marketing and Export Regime.

• The Central Bank of Venezuela retains a right of first refusal over gold production, with a 5 business day period to purchase on market terms. If not exercised, sales to third parties are permitted.
• Exports of gold by non-operators may be subject to a payment of up to 5% of the fine gold content, payable in cash or in kind.
• Exports of critical minerals and rare earths are subject to a tax of up to 5% of the gross export value and may also be subject to special tax regimes established by decree.

The new mining tax framework is structured around flexible royalties, a gross revenue-based mining tax, deductible contributions to the National Mining Fund, and a broad set of exemptions, pointing toward a more streamlined and centralized tax regime.

However, the effective tax burden will ultimately depend on the contractual determination of royalty rates and tax parameters, as well as the development of secondary regulations and the financial structuring of each project