AS the House of Representatives appropriations committee passed on second reading a proposed mining tax measure, the mining industry players under the Chamber of Mines of the Philippines (COMP) vowed to work with lawmakers to help put in place a mining taxation they claim will make the country’s mineral development sector globally competitive and attractive to local and foreign investors.
COMP Chairman Michael T. Toledo welcomed the House version of the bill and said the industry would work with the Senate when it starts hearing on the proposed mining tax version.
“In a nutshell, we do welcome the House passage of the bill. We were working closely with the House leadership and hoping it would also pass in the Senate,” he told reporters at the sideline of the “2023 Mining Philippines International Conference and Exhibition” last Wednesday.
House Bill (HB) 8937 proposes a royalty-calculated tax against margins realized by mining companies. It also pushes for a windfall profits tax.
Toledo described the House version as “fair” and “progressive” as “it is not based on revenue, but on profit.”
As it is still a bill, he said COMP will work with the Senate to convince lawmakers of a taxation scheme that would make the Philippine mining industry competitive.
Toledo said the industry, in general, supports tax based on windfall profits based on margins. He added miners are confident that lawmakers will heed the industry’s appeal.
PHILEX Mining Corp. Chairman Manuel V. Pangilinan also cited that a new mining fiscal regime is a welcome development and assures government of “an appropriate share” of the benefits derived from the business.
In his speech during the conference, Pangilinan highlighted the need for equitable sharing from mining revenues, wherein the National Government and local government units (LGUs), will share revenues from mining taxes more “equitably.”
“The national government must [ensure] the timely remittance of taxes due LGUs. After all, mining is location-specific and I sympathize with LGUs’ desire to realize the fruits of the resources situated in their communities,” he said.
Pangilinan recalled there was a proposal in Congress for excise tax shares be directly remitted to the LGU hosting the mining operations. Unfortunately, the proposal was not properly discussed, he added.
Pangilinan said tax issues confronting the mining industry may be a handful. Nonetheless, Philex remains optimistic, he added, because the Marcos administration “has been clear, predictable and transparent with respect to mining.”
“We applaud the president’s desire to expand the industry, spread the benefits of mining into the countryside, and incent the processing of ores into higher value-added export products,” says Pangilinan said.
He noted that President Ferdinand R. Marcos Jr. and his economic managers “have unequivocally identified mining–done sustainably and responsibly” as important to progress. Pangilinan also noted that the Department of Environment and Natural Resources (DENR) “is making decisions based on empirical data and consultation with all stakeholders.”
“Such fair and practical governance has always been part of our wish-list as an industry, we keep an eye on challenges—and we do acknowledge with thanks and wish fulfilled.”
The Philex Mining executive emphasized that “mining is not the enemy. Poverty is.”
“The most damaging myth with which our industry must contend with is the idea that we must choose between sustainability and mining,” Pangilinan said. “This is a false dichotomy—It is a false choice.”