THE Department of Finance is eyeing the privatization of mines held by the government to raise more revenues as the country is still grappling with the impact of the pandemic.
Finance Secretary Carlos G. Dominguez said on Wednesday he has already asked the Privatization Management Office (PMO) to push for the privatization of the Nonoc and Basay mines, among other mining assets of the government.
“In fact, just a few days ago, we had a complete review of the mining assets held by the government through the Privatization Management Office and I have asked them to push the privatization of Nonoc mines, of Basay mines and all the other mines held by the government,” Dominguez said during the 46th Philippine Business Conference by the Philippine Chamber of Commerce and Industry, the country’s largest business organization.
He also said he has been pushing for the revival of the mining industry “because they provide good jobs in the rural areas.”
He added, “We are also working with the DENR [Department of Environment and Natural Resources] and MGB [Mines and Geosciences Bureau] to push mining to open again.”
Sought to clarify how much would be raised from the planned privatization of mines, Dominguez told reporters: “Valuations are being updated.”
Dominguez’s remark comes just almost a week after he expressed readiness to work on the privatization of gaming activities of the Philippine Amusement and Gaming Corporation (Pagcor) and Philippine Charity Sweepstakes Office (PCSO) to generate more funds for the government.
Instead of the government imposing new taxes to shore up funds, Senate Minority Leader Franklin Drilon urged the government to privatize the gaming industry and sell public assets such as Camp Aguinaldo and Camp Crame.
Need to pay debts
Dominguez earlier told the Senate that by late 2021 or early 2022 they “will start looking at additional revenues to pay for the heavy indebtedness that we are incurring this year.”
By the end of this year, the national government expects its outstanding debt to reach P10.16 trillion, up by 31.42 percent from last year’s amount.
As of end-August, the country’s debt stock has already swelled to P9.6 trillion as it secures more borrowings to finance its spending needs amid the Covid-19 pandemic.
For this year, gross borrowings of the national government from January to August have also reached P2.47 trillion, equivalent to more than 80 percent of the all-time-high P3-trillion borrowing program set by the Development Budget Coordination Committee (DBCC) this year amid the Covid-19 pandemic.
Attracting investments
ON the same forum, Dominguez also took a swipe at the Board of Investments—the investments promotion arm of the Department of Trade and Industry—for not doing its job to proactively bring in investments into the country.
Under the proposed Corporate Recovery and Tax Incentives for Enterprises bill (CREATE), Dominguez said they even gave the BOI the ability to tailor-fit the incentives for a particular industry.
Dominguez said the BOI should identify the industries that the country wants and offering them packages of incentives rather than passively waiting for investments to come, which he said is “not the role of BOI.”
According to the DOF chief, “I said the most important thing is to directly talk to these companies who have the potential of moving out and offer them [package of incentives]. Unfortunately, and you know I don’t want to criticize the BOI or anything, but the BOI does not see itself as a marketing organization. They do not identify which industry should come in,” he said.
If passed into law, the CREATE bill will bring down corporate income tax to 25 percent, from 30 percent, on one hand. On the other hand, it will rationalize incentives, including the 5-percent tax on gross income earned paid in lieu of all local and national taxes, granted to investors.
Image credits: Roy Domingo