Local purchases, salaries enhance economic activity in Zambo Peninsula
Apart from being a catalyst for growth in the Zamboanga Peninsula, TVI Resource Development Philippines contributed P35 M in excise tax payments to the National Treasury in 2006, a much-needed boost to the government’s efforts to balance the fiscal deficit in order to finance basic services such as education and infrastructure, particularly in the countryside.
Reflecting the Company’s growing contribution to the country’s socio-economic development, TVI Resource Development Philippines, Inc. (TVIRD) nearly tripled its excise tax payments to the Philippine government last year to P35.4 million, representing a 266% increase from P13.3 million in 2005.TVIRD also continued to be an engine of growth in Region 9, spurring economic activity in Siocon and surrounding municipalities in Zamboanga del Norte and adjacent Zamboanga Sibugay through the Company’s local purchases as well as salaries and wages for some 700 employees.
Compared with its revenue contribution of P2.2 million in 2004 when TVIRD began operating its Canatuan Gold-Silver Project, the Company’s excise tax payments grew by 1,609% in 2006.
TVIRD President Eugene Mateo said these tax payments “provided a much-needed boost to the government’s efforts to balance the fiscal deficit in order to finance basic services such as education and infrastructure, particularly in the countryside.”
Mateo reiterated TVIRD’s support for the passage of House Bill 1445, which, when enacted into law, will automatically give local government units (LGUs) a 40% share of income tax from mining operations and big companies that operate in these LGUs’ respective localities. He said the House of Representatives has approved HB 1445 on third and final reading in June 2006, but has remained pending in the Senate since then.
“Zamboanga del Norte, Canatuan Project’s host province, would have received over P14.4 million, representing 40% of TVIRD’s tax payments in 2006, had HB 1445 been passed last year,” Mateo said. Under the present law, companies are mandated to pay their taxes directly to the national government, which, in turn, allocates a certain portion of the taxes to the LGUs in the form of Internal Revenue Allotment – a process that normally takes several years.
Nevertheless, TVIRD continues to enhance economic activity in the Zamboanga Peninsula from the cost of operating the Canatuan mine, notably in the Zamboanga del Norte municipalities of Siocon, Sibuco, Sirawai and Baliguian to the west, and neighboring R. T. Lim town in Zamboanga Sibugay to the east. In 2006, TVIRD contributed an estimated P1.5 billion in economic activity to the region, in addition to P281.4 million in the form of local purchases, P97.3 million in wages and salaries, as well as P7.7 million in SSS, Pag-Ibig and Philhealth contributions.
These are on top of the Social Commitment Initiatives being undertaken by TVIRD for residents in and around Canatuan under the Company’s Social Development and Management Plan (SDMP). The SDMP provides the framework that will serve as the TVIRD’s guidebook as it continues to support the welfare of the people in its immediate and secondary affected communities. The document captures the many good things the Company has done – and will continue to do – for its host and impact communities in the areas of education, livelihood, basic services, health and environmental safety, their socio-economic enhancement and sustainability on and beyond the mine life.
Moreover, in 2006, TVIRD paid the Siocon Subanon Association, Inc. (SSAI) royalty equivalent to 1% of the Company’s gross revenues amounting to P13.6 million, net of final tax. This figures is nearly three times the P5 million royalty remitted by TVIRD to SSAI in 2005. SSAI is the legal representative of the Certificate of Ancestral Domain Title holders of Canatuan. Under the Memorandum of Agreement for the development of Canatuan forged between SSAI and TVIRD, the Company has no influence over how the IPs will invest their royalty.
“We expect our tax contributions to further increase once we commence our Copper-Zinc Project, also in Canatuan, by end-2007 or by early 2008,” Mateo added. “With an estimated mine life of six to seven years, the Copper-Zinc Project will undoubtedly be a catalyst for development not only for Siocon and Zamboanga del Norte, but for the entire Zamboanga Peninsula as well.”