House bill boosting gov't tax take on mining approved on 3rd reading

House of Representatives (Ellson Quismorio/ MANILA BULLETIN)

A measure that aims to increase government revenues from the mining industry has been passed on third and final reading during a marathon session in the House of Representatives. 

Garnering 272 affirmative votes was House Bill (HB) No. 8937, or the proposed Act enhancing the fiscal regime for the mining industry in the Philippines. 

There were four negative votes and one abstention to the bill, said presiding officer Deputy Speaker TUCP Party-list Rep. Raymond Democrito Mendoza. 

The measure was approved just before 12:30 a.m. Tuesday, Sept. 26 during a suspension of the plenary debates on the P5.768-trillion General Appropriations Bill (GAB) or proposed national budget for 2024. 

Under the bill, four news section--151-A, 151-B, 151-C, and 51-D--are created under Republic Act (RA) No.8424, also known as the National Internal Revenue Code of 1997, as amended. 

"No less than the Chamber of Mines of the Philippines has expressed support for the measure as it went through the legislative process in the House. I agree with the chamber that the fiscal changes being introduced by this bill will help the country’s post-pandemic economic recovery," Speaker Martin Romualdez said in a statement following the bill's passage.

Chamber of Mines of the Philippines Executive Director Ronaldo Recidoro earlier said that the measure would give the government a fair and increased tax take from mining while ensuring the competitiveness, attractiveness, and sustainability of the industry. 

The measure will subject large-scale metallic mining operations within mineral reservations to royalty rate of four percent of the gross output of the minerals or mineral products extracted or produced. 

For large-scale metallic mining operations outside mineral reservations, a margin-based royalty on income from metallic mining operations would be imposed. 

On the other hand, a royalty rate equivalent to one-tenth of one percent for small-scale metallic operations will be implemented. 
 

"Through the bill, the mining industry proves itself as a key partner of the government in nation-building," added Romualdez, leader of the 311-member House of Representatives.

HB No.8937 also requires small-scale miners to register with the Mines and Geosciences Bureau and the Mining Board of the concerned local government unit (LGU) and encourage them to organize into cooperatives to qualify for the awarding of a People’s Small-Scale Mining Contract. 

A windfall profits tax would also be imposed for each taxable year on income from metallic mining operations. Thus is on top of the taxes imposed under National Internal Revenue Code.

All metallic mining contractors shall provide the Bureau of Internal Revenue (BIR) a copy of approved marketing contracts and sales agreements, including those submitted to the Mines and Geosciences Bureau, on all sales and exportation of minerals, mineral products, and raw ores. 

Two of the solons who voted negative, Makabayan members Kabataan Party-list Rep. Raoul Manuel and Gabriela Party-list Rep. Arlene Brosas, questioned the decision of the plenary to conduct nominal voting despite there being only 25 to 30 solons on the floor--roughly a tenth of the House membership. 

At least half plus one of the 311-member chamber is needed for a quorum. The plenary session began over half a day earlier at 9 a.m. Monday, Sept. 25, with the proceedings mostly covering the GAB debates. 

Before the actual nominal voting, Duty Majority Leader Iloilo 3rd district Rep. Lorenz Defensor bared that electronic voting had been allowed for the purpose of passing the important bills. Mendoza concurred with Defensor.