MANILA – Mining companies in the Philippines are looking for common ground on revenue-sharing arrangement with the government, but a proposal to impose additional royalties remains unacceptable to them, a senior industry official said on Friday.
“The government wants more. I think the challenge is to find the right revenue-sharing formula that is fair to everyone,” Chamber of Mines of the Philippines president Benjamin Philip Romualdez said.
“And I don’t believe that the proposal of an additional 5 percent royalty tax is the answer.”
Speaking to reporters at an industry event, Romualdez said miners were firm in their position against additional royalties and would discuss the issue with a panel President Benigno Aquino created to craft a comprehensive mining policy.
In an interview with Reuters in September, Aquino said the government was seeking to increase royalties on mining and wants projects to include processing.
Environment Secretary Ramon Paje had said the government wanted to declare more mineral reservation areas to enable it to increase collection of a 5 percent royalty tax.
“Under the current scenario of high metal prices, the government can argue that the industry can afford it,” Romualdez said.
“But when metal prices come down, and they will come down, the proposal of additional 5 percent royalty tax will essentially make those projects lose money and no longer feasible.”
The Philippines may miss its mining investment forecast this year of up to a record $2.8 billion because of delays in the lifting of a year-old moratorium on mining permit approvals, Leo Jasareno, director of state agency Mines and Geosciences Bureau, said on Monday.
The moratorium can only be lifted once Aquino signs an executive order aimed at improving environmental standards at mines and increasing the state’s mining revenue.
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Source: The Philippine Star, October 24, 2011
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