33 extractive companies agree to enhance tax transparency

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Astakeholders’ group said 33 mining, gas and oil companies have expressed their commitment to a transparent extractive industry by signing waivers that would allow the disclosure of their tax and royalty declarations to the government.

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They appealed to other extractive companies to also join the initiative.

In a press briefing on Wednesday, the Philippine Extractive Industries Transparency Initiative (PH-EITI) said the waivers will allow the Bureau of Internal Revenue (BIR) to disclose the firms’ tax payments and credits to the upcoming PH-EITI Country Report which will be launched in December this year.

PH-EITI is composed of different stakeholders from the government, the extractive industries, and civil society. It carries out and fulfills the Philippines’ requirements for the EITI, an international standard for the transparent reporting of revenues
from natural resources.

As a global initiative, EITI is committed to transparency in the bilateral disclosures of industry payments and government collections coming from non-renewable national resources.

Assistant Finance Secretary and PH-EITI Focal Person Ma. Teresa Habitan said the EITI report will disclose how much extractive companies paid to the national government in terms of taxes to the BIR, duties to the Bureau of Customs, royalties, fees and charges to different government agencies such as the Mines and Geosciences Bureau (MGB), and how much they pay to the local governments.

“It [the report]also creates an awareness of how industries operate and allows them to demonstrate their willingness to be transparent about their operations” Habitan said.

As of July 22, PH-EITI said 33 oil, gas, and mining companies have submitted the required BIR waivers. This is out of total of 51 firms that PH-EITI approached, bringing the percentage of complaint to 65 percent.

Included in the signatories were 28 mining companies, and five oil and gas firms.

Among the mining companies who signed were Benguet Nickel Mines Inc., Rio Tuba Nickel Mining Corp., Lepanto Consolidated Mining Co., OceanaGold (Philippines) Inc., Philex Mining Corp., Apex Mining Co. Inc., Philippine Mining Development Corp., and Marcventures Mining and Development.

Meanwhile, signatories from oil and gas companies included Shell Philippines Exploration B.V, Chevron Malampaya LLC, PNOC-Exploration Corp., Nido Production Galoc. Pty. Ltd. and Galoc Production Co.

Chamber of Mines Vice President for Legal and Policy Ronald Recidoro said the mining industry supports the initiative because it supports the country’s viability as a venue for mining investments.

“There was a need for transparency, precisely to encourage investors to come. Transparency allows for discussion for facts-based policies,” he said.

Despite the positive response from the industry, PH-EITI noted that 11 mining companies, 6 oil and gas firms, and one coal mining concern have yet to execute the necessary waivers that will allow BIR to disclose their tax returns.

According to PH-EITI, these companies include Citinickel Mines and Devt. Corp.; Pacific Nickel Phils. Inc.; SR Metals Inc.; Mt. Sinai Mining Exploration and Development Corp.; Greenstone Resources Corp.; Adnama Mining Resources Inc.; AAM-PHIL Natural resources Exploration and Development Corp.; Shuley Mine Inc.; Carrascal Nickel Corp.; The Philodrill Corp.; Oriental Petroleum and Minerals Corp.; Alcorn Gold Resources Corp.; Trans Asia Oil & and Energy Philippines Corp.; Forum Energy Philippines Corp.; Forum Pacific Inc. and Semirara Mining Corp.

“We are challenging these companies to display their commitment to transparency and accountability by signing the BIR waiver and complying with PH-EITI. We are still a long way from achieving 100 percent participation from all the extractive companies,” said Dr. Cielo Magno, national coordinator of the civil society organization Bantay Kita (BK).

The group noted that current macroeconomic data showed very little socio-economic benefit from mining. BK said there are forty large-scale metallic mining companies operating in the country whose contribution to the gross domestic product is only about 1 percent.

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