Passage of new mining tax postponed

The House of Representatives is planning to resume its discussion on the passage of a new mining tax next month, further postponing the government’s hopes to get a higher share from mining operations.

The Department of Finance (DOF) has been pushing for a new fiscal program in mining and has remained hopeful that a new mining tax will be implemented, but doesn’t necessarily see it being applied this year, according to DOF Assistant Secretary Maria Teresa S. Habitan.

Habitan this might be discussed next year as there are only three months left this year, and there’s a tightness of schedule in the Senate.

Albay Representative Joey Salceda told Manila Bulletin reporters that there will be a congressional hearing on the rec ently filed House Bill (HB) 5022 in November about establishing new fiscal regime for the mining sector.

The proposed HB 5022 proposes the application of royalty on mining operations within and outside mineral reservation areas.

Mining firms are to pay the government a royalty of up to 5 percent, while those within mineral reservation areas should pay 3 percent royalty tax. This will be applied to large-scale metallic mining operations.

On the other hand, small-scale mining operations shall be exempted from the payment of royalty.

DOF is currently studying the proposed bill and closely monitoring when it will be taken up in Congress, Habitan said.

“[HB 5022] is a mixture of DOF-industry proposal with a Salceda twist. But the royalty provisions are similar to the industry’s proposal,” Habitan was quoted in a Manila Bulletin report.

Habitan said the proposed bill is quite similar to the amended HB 8400, which was already passed on third and final reading last November.

The original HB 8400 imposes a five percent royalty on all mining companies regardless of being in and out of mineral reservations areas.

However, no corresponding Senate Bill was adopted before the end of the 17th Congress.

“There simply was not enough time. We are now into the 18th Congress and we must face this all over again,” COMP Chairman Gerard Brimo said a few weeks ago.

Habitan added that DOF hasn’t got a word when the senate will tackle the corresponding bill on a new mining tax.

Vice president for corporate communications at COMP Rocky Dimaculangan said the mining industry is also monitoring the new tax proposals but “there has not been any action so far.”

“We need to have the moratorium on new mining projects and the ban on open pit mining lifted ASAP [as soon as possible],” Dimaculangan said.