MANILA, Philippines - The Aquino administration plans to require mining companies and other extractive industries to publish the revenues they pay the government, a ranking finance official said.
The move is part of the government’s plan to join the so-called Extractive Industries Transparency Initiative (EITI), an international multi-stakeholder group formed in London in 2005 that supports improved governance in resource-rich countries through the verification and full publication of company payments and government revenues from oil, gas and mining, Finance Undersecretary Jeremias Paul Jr. said.
Paul said the Philippines’ participation in the EITI would also enable the government to know where the tax perks it provides to companies go and how much these cost.
“This is to make the incentives regime more transparent so that the government will know where the incentives go and how much,†Paul said.
“Greater transparency in the payment of taxes and fees to government by extractive industries and the proper acknowledgement of such payments by government at all levels, will assist in generating revenues from such industries for the benefit of the country and its citizens,†according to the draft Terms of Reference (TOR) of the Philippine Extractive Industries Transparency Initiative Multi-Stakeholder Group (EITI Philippines).
According to the draft TOR, EITI Philippines will be composed of the five government representatives from the Office of the Presidential Adviser on Climate Change, the Department of Environment and Natural Resources, the Department of Energy, the Union of Local Authorities of the Philippines and the Department of Finance.
The Mining Industry Coordinating Council is studying two options for a new revenue sharing arrangement between the government and the mining industry.
The MCC wants to draw up a scheme that would support the country’s entry into the EITI and strike a balance between raising government revenue and keeping a fiscal regime that is competitive with other developing countries.
Features of the new tax revenue scheme will also include regular computations for production volumes and pricing as well as quicker payouts to local government units for their shares since these will be remitted directly to their respective treasury offices.
The MICC, the interagency group tasked through Executive Order 79 to draw up the new policy and draft legislation for mining, is co-chaired by Purisima and DENR Secretary Ramon Paje.