MANILA, Philippines – The potential closure or suspension of 28 mining firms could cost 17 cities and municipalities across 10 provinces around P821.13 million a year in foregone revenues, according to the Department of Finance (DOF).
Finance Secretary Carlos Dominguez III earlier this month ordered a review of the potential tax revenue loss by areas hosting mining firms, in response to the Department of Environment and Natural Resources (DENR) order to close 23 mines and suspend 5 others.
He highlighted that 3 of the municipalities would lose revenues representing more than 50% of their current operating income if the affected mining sites are shut down or forced to suspend operations.
“One is the municipality of Carrascal (in Surigao del Sur), then you have Tagana-an (in Surigao del Norte), and Tubajon (in Dinagat Islands),” Dominguez said in a DOF statement on Monday, February 20.
The updated estimates submitted by the Bureau of Local Government Finance (BLGF) to Dominguez show Carrascal would lose P198.3 million of its mining revenues, or 62.3% of its total operating income.
Tagana-an would lose P70.3 million, or 54% of its total operating income, while Tubajon would lose P38 million, or 55.4% of its total operating income.
The latest overall estimate of P821.13 million, an increase from the initial P653 million submitted by the BLGF last week, is based on data from all the affected LGUs, which followed Dominguez’s directive to assess potential losses.
This new figure does not yet include projected income losses of LGUs that host 75 mining sites whose mineral production sharing agreements (MPSAs) were scrapped by the DENR last week.
The DOF also said the Mining Industry Coordinating Council (MICC), which it co-chairs with the DENR, has formed a multi-stakeholder team to “review existing mining operations in consultation with the LGUs” as part of the government’s commitment to observe due process.
According to an MICC resolution, the review will be based on “the guidelines and parameters set forth in the specific mining contract and in other pertinent laws, taking into account the valid exercise of the State’s police power to serve the common good of the poor.” – Rappler.com