House panel approves fiscal regime for the mining industry

The House Committee on Appropriations approved an unnumbered substitute bill that aims to establish a fiscal regime for the mining industry in the Philippines.

According to a BusinessWorld report, the bill, which consolidated House Bills (HB) 288, 560, 1687, 2557, 4541, 4874, 5022, and 5253, called for large-scale metals miners to pay for a royalty equivalent to three percent of their total gross output.

The bill also proposed to create a National Resource Trust Fund which aims to collect revenues from mining operations and “extend their benefits to future generations” through educational programs, technological research programs, health services, and disaster risk reduction management initiatives.

The Trust Fund will be established from the annual payment of mining contractors to the Bureau of Internal Revenue (BIR) of an additional two percent based on gross output for large-scale metals miners.

Failure to comply with these obligations will warrant “immediate suspension or closure of the mining activities” of the mining concession holder. Moreover, an auction system for concessions, which will be established by the Mines and Geosciences Bureau (MGB), was also proposed.

Amidst these conditions, small-scale miners were said to be exempted from the said fiscal regime.

“This will minimize awarding of mineral agreements based on asymmetrical information, first-come-first-served systems, and patronage politics. Moreover, it shall promote investments in mineral-rich areas through an online portal open to the public,” Albay Representative Jose Maria Clemente S. Salceda was quoted as saying in the report.

By requiring full public disclosure in the mining industry, the measure also institutionalizes the Philippines’ participation in the Extractive Industries Transparency Initiative (EITI).

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House panel approves fiscal regime for the mining industry

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