Government keeps moratorium on new mining projects

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Executive Order (EO) 79, signed in 2012, imposed the moratorium on new mineral agreements "until a legislation rationalizing existing revenue sharing schemes and mechanisms shall have taken effect".

Metro Manila (CNN Philippines, December 19) — The government's Mining Industry Coordinating Council (MICC) -- the inter-agency organization overseeing the operation of mines in the country -- decided to keep its moratorium on new mining projects, the Department of Finance (DOF) said Tuesday.

In a statement, DOF said that during the 33rd MICC meeting on December 12, the council "deferred a recommendation on the lifting of the moratorium on the issuance of new mineral agreements."

The Department of Environment and Natural Resources (DENR) asked whether the excise tax increases on mineral products under the Tax Reform for Acceleration and Inclusion (TRAIN) Law are enough to meet the requirements for lifting the moratorium.

Executive Order (EO) 79, signed in 2012, imposed the moratorium on new mineral agreements "until a legislation rationalizing existing revenue sharing schemes and mechanisms shall have taken effect".

The DOF however said TRAIN only increased the excise taxes and did not cover implementing a new fiscal regime for mining.

The MICC then agreed that the new revenue-sharing schemes and mechanisms for mining will be included in the second package of the Comprehensive Tax Reform Program, under House Bill 8500. DOF's proposal of the second tranche would cover other taxes and fees, such as royalty, windfall, and profit taxes.

However, the DOF clarified that TRAIN only increased the excise taxes and did not cover the implementation of a new fiscal regime for mining. The new fiscal regime proposed by the DOF covers other taxes and fees, such as royalty, windfall, profit, and incentives.

The House of Representatives approved House Bill No. 8400 on third and final reading, and transmitted it to the Senate on November 13.

The interagency group also agreed to conduct the second review of mining operations in 2019, to cover the 15 mining firms initially part of the 41 companies under audit during the term of DENR Secretary Regina Lopez in 2016.

The MICC started the first round of review in February 2017, which covered the first 26 mines ordered closed or suspended by Lopez.

The council is chaired by Finance Secretary Sonny Dominguez and Environment Chief Roy Cimatu.