Mining firms want to pay taxes directly to LGUs

MANILA, Philippines - The Chamber of Mines of the Philippines (CoMP) is proposing that mining companies be allowed to pay directly the host local government units their share of mining taxes.

“The two-to three-year delay in the remittance to the local government units (LGUs) of their respective shares in the excise tax from minerals has for many years been a cause for concern of local officials. The excise tax payments of mining companies go directly to the National Treasury and it takes time before the respective shares of the LGUs concerned are determined and incorporated in the General Appropriations Act,” according to Benjamin Philip G. Romualdez, president of CoMP, after his presentation to the Minerals Policy Group formed by President Aquino to iron out the administration’s strategy for the development of the mining industry.

The delay in the remittance of the LGU’s share, Romualdez said, “explains the skeptical attitude of LGU officials towards the mining industry and their inability to fully appreciate the benefits brought by mining operations to their areas.”

Romualdez added: “Ironically, the economic benefits of LGUs from small-scale mining are readily available because it is the LGUs that issue permits to small-scale miners. And yet, being outside the jurisdiction of the DENR, small-scale mining is not properly regulated and pose serious environmental, health and social problems to the localities concerned.”

Romualdez pointed out that there has been a proliferation of LGU-approved and illegal small-scale mining operations which pose serious threats to the safety and welfare of the communities, as well as to the protection and preservation of the environment.

Romualdez explained that the term “small-scale mining” is a misnomer because the production output from many operators is not really small.

Many small-scale miners, Romualdez said, use huge – often smuggled – quantities of mercury and cyanide, which are highly regulated toxic substances, for gold extraction.

Small-scale miners, Romualdez said, do not have appropriate treatment facilities for mine wastes and tailings.

The deplorable situation in small-scale mining communities all over the country, the CoMP president said, is “perpetrated by unscrupulous financiers, corrupt officials and operators who are able to get away without paying excise and income taxes to the government.”