The government is looking at a new mining fiscal regime to provide around Php38 billion in additional annual revenues to contribute to the country’s economic recovery.
In a report by the Philippine Star, the Department of Finance (DOF) has submitted its proposal to reform the mining fiscal regime to the House of Representatives Ways and Means Committee. The proposed changes aim to achieve simplification, fair share, value-adding, and good governance in the mining industry.
DOF’s proposal is seen to result in Php37.52 billion in total revenue per year.
Under the proposal, DOF is eyeing to impose a five percent royalty rate for all large-scale mining operations and provide incremental revenues of at least Php5 billion annually. In the current setup, only those mining projects located in mineral reservation areas are subject to a royalty payment.
DOF is also pushing for a rationalized and single fiscal regime that is applicable to all large-scale metallic mines, regardless of location.
To encourage downstream and proper valuation of minerals, DOF is proposing a 10 percent export tax on the gross value of mineral ore.
However, the Chamber of Mines of the Philippines (COMP) has raised concerns about the proposed fiscal regime.
COMP chairman Gerard Brimo said that if the government is not able to create an internationally competitive tax structure, the country will not be able to attract the investments needed.
