Despite barbs, P200M set for both towns: Itogon, Tuba LGUs ink MOA withPhilex to settle tax tiff

TUBA, Benguet -- Philex Mining Corp. Wednesday signed an agreement with the local governments of Itogon and Tuba, host towns of its gold-and-copper operations in Padcal, Benguet, for a total business-tax settlement of P200 million for 2013 and the past, as a local executive brushed aside criticisms on the accord, stressing vital role industries play in community development.

“Upon compliance by Philex of provision numbers 4, 4.1, and 4.2 above, Itogon and Tuba hereby acknowledges that all previous business taxes due them, respectively, are deemed paid and that they shall have no further claims against Philex for any supposed business taxes due for 2013 and all earlier years,” the six-page draft MOA said.

 The said provisions, which highlighted “full, absolute, complete, and final settlement” of the local business taxes owed, including surcharges and interests, stipulate that theamount shall be equally shared by Tuba and its neighbor Itogon, whose mayorstressed that an ongoing boundary dispute between the two towns has delayed the collection of business taxes from Philex Mining.

 “The signing of this MOA is a living testament that Philex Mining will always fulfill its obligations to Tuba and Itogon,” Eulalio Austin, Jr., CEO and president of Philex Mining, said in a speech at the signing ceremony held at the Smith Hall, of Padcal community, in Barangay Camp 3, Tuba.

The MOA said that of the P200-million, P50 million in cash shall be paid directly to the Cashier’s Office of Itogon and another P50 million to that of Tuba within 10 days upon the execution of the accord, while the remaining P100 million shall be divided equally for the respective public projects of the host towns, payable in equal installments (P25 million per) by the last quarter of this year and the third quarter of 2015.

 From 2014 onwards, including the time when Itogon and Tuba will have eventually resolved their ongoing boundary dispute, the host towns agree to a 50-50 sharing of the business tax imposed on 70 percent of gross sales or receipts derived from Philex Mining’s Mineral Production Sharing Agreement (MPSA) 276, which falls within the contested area; the business tax imposed on 30 percent of gross receipts goes to Pasig City, where the company has its head office.

Manuel Agcaoili, SVP at Philex Mining and resident manager for Padcal Operations who signed the MO with Mayors Victorio Palangdan (Tuba) and Florencio Bentrez (Itogon), said, “Through the years of its existence, Philex has shown, time and again, that it never shied away and will never shy away from its commitments and responsibilities.”

 Bentrez thanked all parties that had hammered out the accord, saying they did their best, and stressed the importance of moving forward through unity. “I hope this signing of the MOA will settle everything,” he said. “We want to strive, we want to stand united. Without the local industries, no local government can stand up on its own.”

 He brushed aside criticisms on the accord, saying these camps did not even help in finding a resolution to the business-tax issue, and that they are now becoming a burden to his municipality.

“We have done our best to have this MOA,” he said. “And I thank Philex for helping us develop our community.”

 For his part, Palangdan noted that his municipality has been supportive of Philex Mining and its social programs, adding that he and Bentrez had agreed that whatever tax payments would be coming from Philex Mining will be divided equally between the two towns.

Besides fulfilling its tax obligations to both local and national governments, Philex Mining has also been implementing its various social projects in Padcal’s outlying communities, which cover both the host barangays of Camp 3, in Tuba, and Ampucao, in Itogon; and the neighboring barangays of Camp 1 and Ansagan (both in Tuba) and Dalupirip (Itogon).

 The company earlier said in a statement that Padcal has allotted for this year P101.5 million, or 1.5 percent of Philex Mining’s total operating cost of P6.77 billion for 2013, for its projects under the Social Development and Management Program (SDMP), the Information, Education, and Communication (IEC) campaign, and the Development of Mining Technology and Geosciences (DMTG).