Government urged to go after small-scale miners

MANILA, Philippines -  Stakeholders in the mining sector yesterday urged the government to run after small-scale miners in line with efforts to impose additional tax on the mining industry.

The Chamber of Mines of the Philippines said the government should go after those not paying taxes at all, like the small-scale miners, instead of picking on them.

“Look at the small-scale miners, they account for P42 billion of what is actually produced and sold to the Central Bank yet there is no tax imposed on them. Why don’t they go after those that are not paying any tax at all? There’s a big loot from the small-scale miners,” said Benjamin Philip Romualdez, president of Chamber of Mines of the Philippines (CMP).

Romualdez earlier revealed to The STAR that the government is bent on pushing for a five percent growth in the mining sector.

Romualdez said the Department of Environment and Natural Resources (DENR) had made a presentation indicating that total revenues from the mining sector would amount to some P175 billion.

The DENR said the mining industry is only paying a fraction of that figure.

Out of the said amount, some P27 billion is attributed to gold producers while P15 billion is contributed by copper producers.

CMP chairman Artemio Disini decried the plan to tax large-scale miners.

“This could be because we’re visible, we pay, and we don’t have a choice that’s why their eyes are on us. However, the government should also get a fair share from the small-scale mining groups,” he said.

Figures provided by the group showed that from 2005 to 2010, a total of P20.152 billion in taxes were paid to the government, with the national government receiving P14.03 billion and the local government units where mines operate getting P1.26 billion.

The group also pointed out that they are pushing for the adoption of the “Contractive Industries Transparency Initiative,” a scheme started by the British government and the World Bank.

“This is a global initiative that is pushing for us in the mining industry to be open and transparent. This means that we are willing to be audited, and in turn for the government also to be audited, to see how much they received,” Romualdez said.

“We have a very good mining law. There is just a need to implement it and for it to be applied to everyone,” he added.

The group also expressed dismay over a number of organizations spreading misinformation about the negative effects of mining in the community.

“Contrary to what they have been saying about us, we are very much engaged in responsible mining,” Disini said.

He pointed out even mining projects have been regarded as vehicles for development.

“In the country, several areas which used to be remote and uninhabited have emerged as bustling communities and self-reliant population centers. Development in the areas has been basically initiated by mining companies, ” Disini said.

“Even before the mandated Social Development and Management Program of the DENR, the mining industry has already been a catalyst in developing communities where the mining operations are located.”

Disini added that mining has continued to be a magnet for the migration of people with expertise and their families as well as for people seeking good paying jobs as miners, skilled laborers, and wage earners.

Environment Secretary Ramon Paje said the government is expected to earn P7 billion annually from mining operations when new mineral reservation areas in the country are identified.

Paje noted the government receives only two percent of gross sale from mining operations in the form of excise tax.

He said the scheme would get an additional five percent in royalties if the mining operations in declared mineral reservation areas are identified.

The Mining Act of 1995 stipulates that the President may identify mineral reservation sites upon the recommendation of the Mines and Geosciences Bureau (MGB) through the DENR secretary.

This may be done if there is a need to preserve raw materials for industries important to national development; or certain minerals for scientific, cultural and ecological value.

Data from the MGB showed that the government is earning P390 million a year from mineral production areas.

Paje said that at present, there are eight mineral reservation sites in the country located in Ilocos Norte, Zambales, Bulacan, Camarines Sur, Samar Island, Surigao del Norte, Compostela Valley, and Zamboanga del Norte.

The plan to declare additional mineral reservation sites is aimed at providing equitable access to mineral resources and gathering additional non-tax revenue for the government.

Paje said the government is also exploring measures to level the playing field in the mining industry and improve environmental compliance by mining projects.