Published
By Madelaine B. Miraflor
The Department of
Environment and Natural Resources (DENR), the government agency tasked to
regulate the mining industry through Mines and Geosciences Bureau (MGB), said
it is now up to the Department of Finance (DOF) what ideal tax structure to
slap against mining companies as well as to push for the lifting of ban on new
mining projects.
This, after the Mining
Industry Coordinating Council (MICC) deferred the recommendation to lift
Executive Order (EO) 79, which placed a moratorium on the issuance of new
mineral agreements
Under EO 79, no new mineral agreements should be approved “until a legislation rationalizing existing revenue sharing schemes and mechanisms shall have taken effect”.
Under EO 79, no new mineral agreements should be approved “until a legislation rationalizing existing revenue sharing schemes and mechanisms shall have taken effect”.
When the excise tax
hike on mineral products from 2 percent to 4 percent under The Tax Reform for
Acceleration and Inclusion (TRAIN) Law was implemented, the DENR argued that it
should already be considered as a new tax regime.
But the DOF clarified
that TRAIN only increased the excise taxes and did not cover the implementation
of a new fiscal regime for mining.
The new fiscal regime
being proposed now by the DOF covers other taxes and fees, such as royalty,
windfall, profit, and incentives.
In November, the House
of Representatives already passed on third and final reading House Bill (HB
8400), which seeks to “rationalize and institute a single fiscal regime
applicable to all mineral agreements.”
In the upper chamber,
however, it is still uncertain when the DOF proposal on new mining fiscal
regime, which was filed as Senate Bill (SB) 1979 by Senate President Vicente C.
Sotto III, will be taken up.
When asked if the DENR
will submit its comment and recommendation on how to improve the tax structure
under SB 1979, Environment Undersecretary for Mining Concerns Analiza
Rebuelta-Teh said the agency “will defer”.
“In terms of position
[in the new fiscal regime on mining], it’s already up to the DOF,” Teh said.
Nevertheless, she said the DOF is consistent about consulting the DENR about the issue.
Nevertheless, she said the DOF is consistent about consulting the DENR about the issue.
MGB previously
recommended a per commodity tax increase in the mining sector but it was
eventually dismissed.
Meanwhile, most of the
suspension and closure orders issued by former Environment Regina Paz Lopez,
which was just recently validated by Cimatu, already took effect, with only one
company formally appealing to President Rodrigo Duterte.
In November, Cimatu
decided to keep Lopez’s closure orders on Claver Mineral Development Corp.,
Oriental Synergy Mining Corp., Ore Asia Mining and Development Corp.
The DENR also validated
the suspension orders earlier given to Zambales Diversified Metals Corp.,
Krominco Inc., Mt. Sinai Exploration and Development Corp., Libjo Mining Corp.,
Wellex Mining Corp. 1 and 2., Carrascal Nickel Corp., Aam-Phil Natural
Resources Exploration and Development Corp., Strong Built (Mining) Development
Corp., and Emir Minerals Corp.
These companies were
given 15 days upon receiving the decision of the DENR to file an appeal to the
Office of the President (OP).
In a separate
interview, Teh said that all the nine companies who were ordered suspended
already “accepted their fate” and no longer made an appeal.
Claver, however, sought
OP’s intervention, which means the company can still continue to operate until
Duterte issues a final decision.
On the status of Ore
Asia and Oriental, Teh is uncertain. She said the agency is yet to find out if
Ore Asia already received the notice on the decision, while its possible that
Oriental may have already filed an appeal to OP but it is yet to notify the
DENR about it.
“It’s impossible that
these companies won’t file an appeal to the closure orders we issued to them.
My worry is the DENR will just find out about it if the OP began asking our
comments on the case,” Teh said.
On the suspended firms, Teh said five companies already submitted their action plans so it could be allowed to operate after six months or by the time it already finished “fixing its operations”.
On the suspended firms, Teh said five companies already submitted their action plans so it could be allowed to operate after six months or by the time it already finished “fixing its operations”.
These companies are
Zambales Diversified, Krominco, Carrascal, AAMPHIL, and Berong.
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