The Department of Finance (DOF) on Friday welcomed the ratification by the bicameral conference committee of the rationalization of the mining fiscal regime to create a fair and equitable mining environment for all stakeholders.
The bicameral committee report on the disagreeing provisions of Senate Bill No. 2826 and House Bill No. 8937, also known as the Enhanced Fiscal Regime for Large-Scale Mining Act, was signed on June 11, 2025.
The measure is one of the Legislative-Executive Development Advisory Council’s (LEDAC) priority initiatives for the 19th Congress and has the support of President Ferdinand Marcos Jr.
“I thank the Congress for its swift ratification of this long-overdue reform,” Finance Secretary Ralph Recto said.
“With this proposal, we are providing a straightforward and streamlined fiscal policy to encourage more investments in our mining sector. This bill will help fully unlock the Philippines’ rich mineral potential and position us as a major player in mineral production,” he said.
“This is a win-win for the Filipino people and responsible industry players. It ensures a just return for our non-renewable resources, drives investments that create jobs, and strengthens our position as a key player in the global minerals supply chain—especially for critical minerals that are essential to clean energy transition,” said Recto.
The reform updates the outdated tax structure governing the mining sector. It simplifies the fiscal system, guarantees the government’s fair share of revenues, strengthens environmental safeguards, and provides fiscal predictability and stability for investors, all while promoting responsible and sustainable mineral development.
Under the current fiscal regime, obligations of mining groups and companies vary depending on the mining agreement, leading to a complex tax system. It also only imposes a royalty, which is the government’s share from the extraction of non-renewable resources, for mines operating within a mineral reservation.
The proposed measure simplifies the fiscal regime by removing tax distinctions based on mining agreements. It also introduces mechanisms to ensure the government receives a fair share from the extraction of these non-renewable resources.
A margin-based royalty tax will be imposed on mines operating outside mineral reservations, and a windfall profits tax will be imposed on all mines. The approved version adopts fewer tiers for the two new taxes to facilitate compliance and administration and discourage tax avoidance.
The bill includes provisions on ring-fencing to prevent the consolidation of income and expenses of all mining projects by the same taxpayer. This safeguards against possible deduction of losses from other mining projects from more profitable ones.
The reform will institutionalize transparency and accountability mechanisms, ensuring companies make proper payments to the government, host, and neighboring communities. This aims to minimize revenue leakages (e.g., questionable transfer pricing practices), maximize revenue collection, and promote good governance.
The bill is expected to generate an additional P25.06 billion in mining revenues for the government from 2025 to 2028.
