A proposal by the Mines and Geosciences Bureau (MGB) to simplify the mining revenue sharing scheme is being deliberated on by the council in-charge of an ongoing review of rules governing the industry.
Environment Secretary Ramon Paje, who sits in the Mining Industry Coordinating Council (MICC), told reporters Monday that the council is considering MGB's concern that the government’s share under
the proposed take from the miner's gross production value would yield lower revenues for the state.
Under the current tax structure, mining companies pay the regular corporate income tax on top of a 2 percent excise tax, business tax, royalty for mineral products extracted from mineral reservations and royalty payments for indigenous peoples directly affected by mining operations.
In an Aug. 1 letter to Nestor Arcansalin, Board of Investments director of Resource Base Industries Department, MGB director Leo Jasareno said the bureau wants to retain the present tax scheme coupled with either lessening or eliminating incentives.
MGB is batting for the existing 5 percent royalty imposed on mines in mineral reservations to be applied to all tenements.
“We are instead proposing to just implement the present fiscal tax regime, but less the incentives plus five percent of the gross sales as royalty payment, applicable to both mineral and non-mineral reservation areas,” Jasareno wrote.
The MGB proposal appears to ensure equitable share for the government from start to finish mining operations, said Paje.
Noting that only 11 companies have projects within mineral reservations, he added that they are considering if MGB's proposal can be implemented to small-scale mining.
The DENR chief assured that the final tax structure governing the minerals industry will be “better than the existing revenue sharing scheme.
“Natural resources are finite resources. We should be able to get an equitable share from it,” he added.
A bill rationalizing the mining fiscal regime has been drafted into a list of nine measures the economic team is pushing for inclusion on the Legislative-Executive Department Advisory Council's priority list. —
SOA, GMA News