MANILAThe House of Representatives ways and means committee on Monday approved a substitute bill, which aims to establish the fiscal regime for the mining industry.
The panel, chaired by Nueva Ecija Rep. Estrellita Suansing, approved the unnumbered substitute bill to House Bill 422 and 7994, subject to amendments and style, upon the motion of Deputy Speaker Sharon Garin.
Suansing, also the principal author of the bill, stressed the need to create a rationalized and single fiscal regime applicable to all mineral agreements to promote fairness.
This aims to level the playing field, so to speak, considering that under the current taxation setup, only mining contractors inside the mineral reservations pay the royalty tax. [The bill] ensures that the government gets its fair and rightful share in the profits from mining operations, Suansing said.
The bill seeks to retain the imposition of the corporate income tax (CIT) on the mining sector to level the playing field among all other sectors.
It also retains the existing tax regime on excise tax, royalty to indigenous peoples, local business tax, and real property tax.
Suansing said the bill proposes an equitable imposition of royalty on mining operations within and outside mineral reservations, whether small- or large-scale.
The present law requires payment of royalty fees only in mining sites declared as mineral reservations.
The bill seeks to reduce the royalty rate of 5 percent to 3 percent for large-scale mining contractors within a mineral reservation.
For large-scale miners outside mineral reservations, Suansing said a margin-based royalty is imposed, making them liable" as well to pay royalty tax as large-scale mining operators inside mineral reservations.
On the other hand, for all small-scale mining operations within or outside mineral reservations, a royalty equivalent to 1/10 of 1 percent of gross output shall be imposed.
The substitute bill also contains a provision proposed by Speaker Gloria Macapagal-Arroyo to prohibit open-pit mining.
The bill also proposes the exemption of all mining contractors from the coverage of the confidentiality clauses of the National Internal Revenue Code to ensure transparency and the requirement of registration for small-scale miners. (PNA)
Source: Philippine News Agency