South African mining companies are concerned over new proposals which could see them paying even more tax to the government.

A task team currently looking at the windfall tax on "excessive profits" made by coal-to-liquid producer Sasol when oil prices are high, appears to be in favour of extending the tax to all other areas of South African mining.

That could have a huge implication for the platinum mining industry, where prices are expected to rise in future because of the tight margins between supply and demand over the coming years.

However, the South African government has not yet supported these recommendations and issued a statement explaining: "The report of the task team does make some recommendations on the Minerals and Petroleum Royalty Bill, though it was not part of their terms of reference. We have as yet not responded to any of the recommendations."

The government added that it "has a recognised track record in financial management".

This latest development comes as the precious metal mining industry already faces further taxation in 2009, when the country's first ever Royalty Bill comes into force, taxing on turnover of six per cent on unrefined platinum and three per cent on refined platinum, as well as on other precious metals.

Ÿ Adfero Ltd