By Catherine S. Valente , Niña Myka Pauline Arceo and Chynna Grace Ong | The Manila Times | September 5, 2025

PRESIDENT Ferdinand Marcos Jr. on Thursday signed into law a measure overhauling the country’s mining tax system to ensure a more equitable share of revenues for the government and greater transparency in the extractive sector.

The new law introduces a simplified and progressive tax structure for large-scale metallic mining operations, replacing a fragmented regime that varied depending on the type of mining agreement.

“We are putting into place a system that is fairer, that is clearer and more responsive to the needs of both our people and the environment,” Marcos said during the signing of Republic Act 12253 or the Enhanced Fiscal Regime for Large-Scale Metallic Mining Act in Malacañang.

Under the previous system, only mines inside mineral reservations were required to pay royalties, while fiscal obligations varied depending on the type of mining agreement.

Simplified taxation

The new law, which is expected to generate an average of P6.26 billion in additional revenues annually, simplifies and expands taxation across all large-scale metallic mining operations.

The estimated revenue gain from 2026 to 2029 was projected at P25.08 billion in total.

Mines outside mineral reservations will now be subject to a margin-based royalty ranging from 1 percent to 5 percent, depending on profitability.

A tiered tax of 1 percent to 10 percent will apply when income margins exceed 30 percent, capturing excess profits during commodity booms.

The law also introduces a ring-fencing rule so each mining project will be taxed as a separate entity, preventing companies from offsetting losses from one project against profits from another.

“Gone are the days when a mining contractor can bury its profits beneath the weight of losses. No longer can we use one project’s failure to conceal another project’s success,” Marcos said.

“Transparency is now the rule.”

The Philippines is among the world’s most mineralized countries, with an estimated $1 trillion in untapped reserves of copper, gold, nickel, zinc and silver.

Less than three percent of the country’s nine million hectares identified as having high mineral potential are covered by mining tenements, government data showed.

In 2023, exports of minerals, mineral products, and non-metallic mineral manufactures totaled $7.32 billion, slightly down from $7.53 billion in 2022, according to the Mines and Geosciences Bureau.

Philippines ‘blessed’

“Around the world, the demand for minerals is surging. These minerals are needed to service the new technologies, for batteries, solar panels, other vital components of clean energy,” Marcos said.

Noting that the Philippines is “blessed” given its mineral wealth, he also noted that the resources were finite.

“Once extracted, they are gone forever. But if we use them wisely — tax them fairly, protect our environment as we mine, and ensure that revenues return to the people — then their value will outlive all of us,” he added.

Finance Secretary Ralph Recto said the law also mandates stricter monitoring and auditing of mineral sales and exports and promotes transparency in the sector by requiring public disclosure of data.

It also earmarks 10 percent of royalties collected from mines within mineral reservations for mineral exploration and research.

“The Department of Finance is committed to implementing this law swiftly, efficiently, and with full transparency,” Recto said. “We will also continue to engage with all stakeholders to ensure that the law delivers on its promise.”

Special Assistant to the President for Investment and Economic Affairs Frederick Go, meanwhile, said the new law marked “a significant milestone in positioning the Philippine mining sector as a key player in the global value chain.”

The modernization of the industry’s fiscal regime, he added, will promote economic growth by creating jobs and increasing government revenues while also attracting responsible mining investors.

Source: The Manila Times