Peru - Market Insights

Peru as a strategic mining jurisdiction

Peru is widely recognized as one of the most attractive mining jurisdictions in Latin America and globally. Mining has historically been a cornerstone of the national economy and continues to play a central role in the country’s development. The sector contributes approximately 10% of Peru’s Gross Domestic Product (GDP), while also accounting for a significant share of exports, foreign direct investment, and fiscal revenues.

Beyond macroeconomic indicators, Peru’s attractiveness is underpinned by its extensive geological potential. The country is among the world’s leading producers of copper, gold, silver, zinc, and other key minerals, benefiting from its location within the Andean metallogenic belt, which is one of the richest mineral regions globally.

Robust project pipeline

Peru currently hosts a strong and diversified portfolio of mining projects, reflecting sustained investor interest and long-term sector growth prospects:

• 66 mining investment projects:
  • 30 greenfield projects (early-stage exploration and development); and
  • 36 brownfield projects (expansions or extensions of existing operations).
• Total estimated investment: exceeding USD 64 billion.
• Geographic distribution: across 19 out of Peru’s 24 regions.

This broad distribution highlights the nationwide relevance of the mining sector, as well as the opportunities for regional development. The project portfolio also demonstrates a balance between new discoveries and the optimization of existing assets, which contributes to the stability and continuity of production.

Importantly, the Mining Investment Project Portfolio is publicly available and constitutes an outstanding tool for understanding the status of project development, key technical characteristics, and the range of investment opportunities in Peru. Its accessibility reinforces transparency and allows both investors and stakeholders to monitor the evolution of the sector.

Access to concessions and transparency

One of Peru’s key competitive advantages lies in its concession system, which is considered transparent, predictable, and accessible to both local and foreign investors. Mining rights are granted through an administrative process based on priority in filing, rather than discretionary allocation.

The system is supported by robust digital platforms that reduce information asymmetries and facilitate due diligence:

• SIDEMCAT (Mining Rights and Cadastre System). Provides real-time information on mining rights, including location, ownership, and legal status.
• GEOCATMIN (Geological, Mining and Metallurgical Information System). Offers geological, geochemical, and geophysical data, as well as information on environmental and administrative layers.

These tools allow investors to quickly identify available areas, verify overlaps or restrictions, and make informed decisions at early stages of project evaluation. In addition, they are publicly accessible, which facilitates broader and more efficient project screening.

Key challenge: Permitting

Despite its strengths, Peru faces important challenges in its permitting framework. Mining projects are subject to a complex approval process requiring multiple authorizations across environmental, technical, and social dimensions.

Key characteristics of the permitting process include:

• involvement of multiple government entities at national, regional, and local levels;
• requirement to obtain numerous individual permits and authorizations; and
• lengthy and sometimes unpredictable timelines, which may affect project planning and investment decisions.

Among all approvals, environmental permitting (such as Environmental Impact Assessments, EIAs) and access to surface rights represent the most critical milestones. These stages concentrate a significant portion of the legal, technical, and social risks, as they often require stakeholder engagement, community relations management, and detailed technical studies.

Following this framework, the National Environmental Certification Service for Sustainable Investments (SENACE) — the specialized authority responsible for reviewing and approving EIAs for large-scale projects — has been making significant efforts to strengthen the efficiency, transparency, and predictability of environmental permitting processes. These improvements are particularly relevant for the viability of major projects in sectors such as mining and hydrocarbons.

While the permitting system still presents important challenges and opportunities for further improvement, these constraints are neither hidden nor unexpected. On the contrary, they are well identified by both authorities and market participants, and there is an ongoing reform agenda aimed at addressing them. This provides investors with greater visibility into regulatory risks, as well as increasing confidence that the system is evolving toward more streamlined and reliable processes.

It is also important to note that the Peruvian government recognizes the strategic importance of the mining sector for the country’s economic development and competitiveness. In this context, efforts are currently underway to promote a more efficient and investment-friendly regulatory framework, particularly for exploration activities. The objective is to facilitate the timely advancement of mining projects, unlocking the value of Peru’s significant mineral resource portfolio and enabling projects to move more efficiently from exploration to development while maintaining applicable environmental and social standards.

Toward greater regulatory efficiency

Recognizing these challenges, the Peruvian government and stakeholders have been working on initiatives aimed at improving regulatory efficiency and enhancing investment conditions.

One of the key proposals under discussion is the implementation of a “one-stop shop” (ventanilla única) system, designed to streamline administrative procedures, improve interagency coordination, reduce duplication of requirements, and provide greater predictability in permitting timelines. If effectively implemented, such reforms could significantly strengthen Peru’s competitiveness as a mining destination.

In parallel with these regulatory considerations, a clear understanding of the fiscal framework governing mining activities is equally critical for investors. The tax regime not only determines the economic viability of projects but also reflects the state’s approach to resource rent capture and investment promotion.

It is also important to highlight the institutional efforts aimed at actively promoting investment execution. In this regard, the Ministry of Economy and Finance (MEF) has established a specialized team known as the Equipo Especializado de Seguimiento a la Inversión (ESSI). This unit is tasked with supporting and monitoring priority investment projects at the national level, including major mining (including some projects in the exploration phase) and infrastructure developments.

The ESSI plays a key coordination and facilitation role, working closely with project sponsors and relevant public entities to identify bottlenecks, align stakeholders, and accelerate decision-making processes. Its involvement is particularly valuable in complex projects that require interaction with multiple authorities, as it helps ensure continuity in administrative processes and promotes the timely resolution of procedural or regulatory hurdles.

This specialized team is widely regarded as an effective mechanism for de-risking project execution, as it provides a structured platform for dialogue between the public and private sectors. By accompanying key investments throughout their lifecycle, the ESSI contributes to enhancing predictability, reducing delays, and ultimately supporting the materialization of strategic projects in the country.

Tax framework applicable to the mining sector

In addition to its geological attractiveness and institutional framework, Peru’s mining sector operates under a well-defined fiscal regime designed to capture resource rents while maintaining competitiveness. The tax structure combines general corporate taxation with specific mining levies linked primarily to operating profitability.

Corporate Income Tax (CIT) constitutes the backbone of the system, applying a 29.5% rate on net taxable income derived from business activities. For mining companies, taxable income is determined after deducting operating costs, capital expenditures under applicable depreciation rules, and certain sector-specific levies. Notably, payments made in connection with the Mining Royalty, the Special Mining Tax, and the Special Mining Levy are fully deductible, which plays a key role in mitigating the effective tax burden.

Some investors benefit from tax stability agreements entered into under the General Mining Law. These agreements, typically granted in exchange for minimum investment commitments, guarantee the invariability of certain tax conditions over a defined period. In practice, this stability is often reflected in a slightly increased income tax rate (generally +2%), offset by the predictability it provides for long-term financial modeling.

Beyond general taxation, Peru imposes three principal mining-specific levies, all of which are structured around operating profit rather than gross revenue, aligning the fiscal burden with commodity price cycles.

The Mining Royalty (Regalía Minera) is a mandatory economic consideration payable to the state for the exploitation of mineral resources. It is calculated on a quarterly basis and applies a progressive rate ranging from 1% to 12% of operating profit, depending on the company’s operating margin. Importantly, a minimum royalty equivalent to 1% of sales applies when operating profit is low or negative, ensuring a baseline contribution.

The Special Mining Tax (Impuesto Especial a la Minería, IEM) applies to mining companies that do not benefit from tax stability agreements. Like the royalty, it is calculated quarterly based on operating profit, with progressive rates ranging between 2% and 8.4%. Its application is limited to the sale of metallic mineral resources and reflects an additional mechanism for capturing extraordinary profits.

Conversely, companies that have entered into stability agreements are subject to the Special Mining Levy (Gravamen Especial a la Minería, GEM). This levy does not apply automatically as a consequence of having executed a tax stability agreement; rather, it generally applies to companies whose stabilized tax regime predates the introduction of the IEM. In such cases, because the stabilized regime does not include the IEM, companies enter into agreements with the state to pay the GEM as a form of compensation. It follows a similar structure, applying progressive rates ranging from 4% to 13.12% on quarterly operating profit, depending on operating margins.

A key feature of these levies is the definition of operating profit, which serves as the taxable base. This is calculated by deducting from revenues the cost of sales and operating expenses (including administrative and selling expenses), while excluding financial costs and certain accounting adjustments such as revaluation-related depreciation. This approach ensures that the fiscal burden adjusts dynamically to market conditions, capturing higher revenues during commodity price booms while easing pressure during downturns.

In addition to these taxes, mining companies are subject to other mandatory contributions and obligations. Notably, they must distribute 8% of pre-tax net income to employees as part of Peru’s profit-sharing regime, which is one of the highest participation rates among industrial sectors. Companies must also contribute to regulatory oversight through payments to OSINERGMIN (focused on safety and energy supervision) and the OEFA (environmental enforcement authority).

All tax collection and enforcement functions are centralized under the National Superintendence of Tax Administration (SUNAT), which plays a critical role in ensuring compliance and fiscal oversight.

Overall, Peru’s mining tax regime is structured to balance government revenue generation with investment incentives, relying heavily on profit-based mechanisms. This design enhances resilience across commodity cycles and reinforces the country’s position as a competitive and mature mining jurisdiction.