The Philippines has overhauled its mining tax system with the signing of the Enhanced Fiscal Regime for Large-Scale Metallic Mining Act (RA 12253). The law introduces a margin-based royalty and windfall profits tax, ensuring the government captures more revenue when global metal prices soar.
Key features include:
- Royalties ranging from 1% to 5% on income, with a minimum 0.1% on gross output for low-margin mines.
- Windfall tax of up to 10% when mining firms earn outsized profits.
- Limits on tax deductions via a 2:1 debt-to-equity rule.
- Ring-fencing per project, stopping companies from offsetting losses against profitable ventures.
- Transparency safeguards to improve accountability.
The Department of Finance estimates the new regime could raise ₱25 billion in revenues between 2026 and 2029. While miners face higher taxes, industry leaders welcomed the law, citing clarity and predictability—critical for long-term investments in nickel, copper, and other critical minerals needed for the global clean energy transition.
What this means for you: More government revenues from mining could free up funds for infrastructure and social programs. But if companies pass on costs, expect mineral-based goods—like construction materials, electronics, or even EV batteries—to get pricier in the long run.