The Senate Committee on Ways and Means already received and is considering proposed bills pushing for the fiscal regime and revenue sharing for the mining industry in the country.
One of the proposed measures is House Bill No. 8400 sponsored by Cong. Estrellita B. Suansing, representative of Nueva Ecija’s 1st district. The house bill, which was approved in the House of Representatives November 12 last year, seeks to rationalize and institute as single fiscal regime applicable to all agreements.
Cong. Suansing’s house bill also aims to have a margin-based royalty tax on large-scale mining operations outside Mineral Reservations. The tax proposal will have a one percent royalty equivalent to one to ten percent margin, adding .50 percent royalty every 10 percent margin increase. Margin of 70 percent and above will have a five percent royalty.
However, large-scale mining operations found inside Mineral Reservations will have a royalty equivalent to three percent of gross output of the minerals or mineral products extracted or produced by the said operations, exclusive of all other taxes, shall be imposed. On the other hand, small-scale metallic and non-metallic mining operations will need to pay a royalty tax equivalent to one percent of the gross output.
Senate Bill Nos. 225 by Senate Minority Leader Franklin M. Drilon, 927 by Senate President Pro-Tempore Ralph G. Recto, and 1979 by Senate President Vicente C. Sotto III are also also under deliberation of the Senate Committee on Ways and Means.
Under Sen. Drilons’ and Sen. Recto’s bills, the President shall declare mining areas as Mining Industry Zones (MIZs) through Presidential Proclamation before any mining company can operate in said areas. These areas will be managed by the Philippine Mining Development Corporation (PMDC) as administrators.
The government and the mining contractor for large-scale metallic mineral mining operations will also undergo a fiscal regime and revenue sharing arrangement wherein the government share shall be ten percent of gross revenue or 55 percent of the Adjusted Net Mining Revenue (ANMR), whichever is higher.
In the event that the ANMR Margin exceeds 50 percent due to increase in metal prices or other factors, the government, as owner of the minerals, shall get 55 percent of the threshold ANMR plus 60 percent on the excess ANMR. ANMR is arrived at after deducting from gross revenue the allowable deductible expenses.
Meanwhile, Senate Bill No. 1979 proposes to retain the royalty rate of five percent for all mining operations within Mineral Reservations. Meanwhile, for mining operations located outside Mineral Reservations, a phased-in rate is prescribed: three percent on the for the first three years upon effectivity of the Act; four percent on the fourth year; and five percent on the fifth year and thereafter.
