OPPOSE THE CONTINUING ONSLAUGHT ON THE EARTH
“I brought you into a fertile land to eat its fruit and rich produce. But you came and defiled my land and you made my inheritance detestable.” (Jeremiah 2:7)
We, the Ecumenical Bishops Forum (EBF), express alarm over the wanton abuse of natural resources by the Transnational Mining Corporations (TNCs) with their local cohorts in South Luzon Region, especially in Bicol. The experience of the Bicolano people is no different from the plight of local communities in mining areas throughout the country: massive environmental destruction, shrinking economic base of the people, militarization of mining communities, displacement of communities due to land-grabbing and unjust land-conversion, gross human rights violations, destruction of flora and fauna, and further impoverishment of the country. The unresolved and ever continuing polymetallic mining operations in Rapu-Rapu Island, Albay, Labo, Paracale, and Jose Panganiban, Camarines Norte, the aggressive mine expansion in Aroroy, Masbate by Filminera Resources Corp., the peculiar magnetite off-shore mining in Camarines Sur by Bogo Mining Resources Corp; the Palanog Cement Plant in Albay, Panganiban and San Andres, Catanduanes, and the deeper quagmire of maldevelopment of mining in Matnog, Sorsogon challenge us to rethink our role as responsible God’s stewards of creation ( Genesis 1: 26-31 ).
Destructive mining is blatantly unethical, unjust, and senseless for it exacerbates poverty, causes dislocation of livelihood of the people, and even threatens the base of life and life itself.
It is lamentable that the national government equates TNC mining with development, and is remiss in its duties in protecting the environment to the detriment of the people. It has been proven that the negative costs of mining operations far outweigh the gains.
Thus, to further liberalize the mining industry in favour of the mining corporations as being trumpeted by the Aquino administration will mean more suffering and death, dislocation, displacement and ruin of the environment.
Hence we call on the Filipino people:
1. To oppose all destructive mining operations, both locally or foreign-owned;
2. To scrap the Mining Act of 1995;
3. To demand immediate moratorium of large scale mining
4. To demand the demilitarization of mining communities
5. To fight for justice and integrity of creation;
6. To pass the HB 4315 or the Peoples’ Mining Bill
We urge our churches and faith-based groups and institutions to pursue organizing, awareness building, and other relevant activities, and be in full solidarity with the people’s movement against destructive mining operations.
With the liberating power of the Holy Spirit, we seek strength and wisdom to carry this task of asserting the right of the earth to survive and all that dwell therein.
Ecumenical Bishops Forum
October 6, 2011
DA Reports Rise in Fish Catch But Not in Albay Gulf
In the July 12-18, 2011 issue of Diario Veritas, the Department of Agriculture reported:
Nahilingan nin senyales nin pag-asenso an sector nin pagsisira sa paagi kan pagiging aktibo kan mga regional fishing ports sa primerong quarto kan taon.
Ipinahayag nin Rodolfo Paz, an general manager kan Philippine Fisheries Development Authority (PFDA), an mga dakop kan sira an nagtaas nin maabot sa 93 porsyento sa Navotas, Iloilo, asin Sual, Pangasinan.
Siring man an nanotaran sa Davao Fish Port Complex na nagkaigwa man na 40% na pagdakul nin dakop kumparadosa dakop kan mga parasira sa kaparehong peryodo kan nakaaging taon.
Katakod kaini, pinag-engganyar kan DA an gabos na local na gobyerno sa nasyon na pakusugon an industriya nina pagsisira partikular sa aspeto kan environmental protection asin pagbukod sa mga ilegal na mga parasira.
Nakaabot kaya an report sa DA na rampante an paggamit nin mga dinamitakan mga parasira sa nagkakapirang kostal na lugar kan nasyon kun saen saro kan naunambitan digdi iyo an rehiyon Bikol.
At least two points are implied in this report. First, there are rises in fish catch in several areas of the country but not in Albay Gulf. Second, the DA blames all declines in fish catch on environmental degradation “and” illegal fishing.
On the first implication: Why is there no report of any rise in fish catch in Albay Gulf? The answer is obvious: there is in fact a precipitous decline as attested to by fishermen. A 95% decline has been reported here since 2005 the same year when Lafayette went into full operation. Why is there such a decline? We have referred that question to the DA and its line bureau BFAR (Bureau of Fisheries and Aquatic Resources) but no answer has ever been given. (They have not even reported any investigation conducted on the cause of death of a 15-meter sperm whale in 2010.)
We have ascribed the decline to mining in Rapu-Rapu from which flow several creeks that are discolored. Officials of Rapu-Rapu Polymetallic Project reply that fish catch decline is a global phenomenon (technical meeting on April 26, 2011 in EMB). Now, we have here a rebuttal to that defense - the DA report of fish catch rise in at least four areas. Fish catch decline is not a global phenomenon.
On the second implication: Since DA reports rises in fish catch in four areas of the country and calls for curtailment of illegal fishing, then it follows that after curtailing illegal fishing we can observe a rise in fish catch. In Albay Gulf, the Bantay Dagat, a local watch group against illegal fishing, has been very active in this campaign. However, the fish catch decline continues. Couple this observation with the fact that the DA confirms the presence of a fish sanctuary in Gaba Bay, Villahermosa, Rapu-Rapu . With a fish sanctuary and active campaign against illegal fishing, fish population should increase within one or two seasons but this does not happen. Hence, illegal fishing cannot be the cause. Again, we are led to the more obvious – the mining operation in Rapu-Rapu.
It should be pointed out that much of the fish catch in the past according to fishermen consisted of migratory fish from the Pacific Ocean – yellowfin tuna, kwaw, malasugi, tanguigue, sharks, etc. These species do not need the local breeding grounds in Albay Gulf to multiply. They spawn in the areas around Guam and come to Albay Gulf to feed seasonally. They pass through the gap between Rapu-Rapu and Prieto Diaz following the current. Since 2005, the catch of these species has consistently declined. Something is barring their path in that gap and that something is none other than the contamination of silt and heavy metals flowing from the mine site through the creeks and ultimately to the waters around Rapu-Rapu. The current carries the contaminants into the Albay Gulf and spreads them as the tide flows back out into the Philippine Sea.
Any way we look at the phenomenon in Albay Gulf, the glaring fact is that mining has adversely affected our food supply. Between fishing where we derive 100% of the benefits and Rapu-Rapu mining where were derive only 1/3 of 1% (according to the statement of Gov. Joey Salceda in the Philippine Daily Inquirer on March 28, 2011), we have to choose the former.
The same issue of Diario Veritas banners the headline “City secures fish trade.” It reports the plan of the Legazpi City Council “to beef up the local fishing industry through stern legislation . . . Councilor Carlos Ante had already invited the different leaders of the local fisher folk to lay out details of a proposed ordinance to secure their livelihood.” I laud the efforts of the good councilor. However, I suggest that a more comprehensive view of the problem be taken if it is ever intended to be solved. As management theory suggests, any solution should address the real cause of the problem. Limiting the analysis within the immediate vicinity of the city’s coastal waters will lead to a failure at solution.
Not too long ago, we learned that several city councilors led by then Mayor Noel Rosal visited the Rapu-Rapu mine. In the newsletter of the Mines and Geosciences Bureau, Foresight, he was quoted as follows: “The mine is full of promise for the province” (Pages 9 and 11). I wrote Hon. Rosal in November 2010 (by then he had become the City Administrator) attaching photographs of the creeks colored brown, red, yellow and orange. I asked if the tour guides brought his group to the creeks. It’s September 2011 and I still have to receive a reply. I also wrote to MGB V and EMB V. Both replied that the contamination in the creeks is within “tolerable levels.”
RRMI, RRPI, LG, Kores and MSC should not think that they have succeeded in convincing the local community in their claim that the mine is operated responsibly and that the benefits they have derived translate to sustainable development of the people. The condition of the creeks, the fish catch decline and the poverty prevailing in the island all speak eloquently of the truth. Environmental damage and economic injustice have worsened. Adding insult to injury, they have praised themselves through press releases about their environmental awards while the residents of Rapu-Rapu and the fishermen of Albay Gulf continue to suffer. The contamination in the creeks may be within “tolerable levels” in the standards of the DENR but the poverty of the island residents, the fish catch decline and the environmental damage are definitely intolerable in the standards of the local community.
The DA, BFAR, DENR, Legazpi City Council, other local government units and other authorities better look into Rapu-Rapu mining honestly if they really want to solve the problem of fish catch decline in Albay Gulf. Anything less than that would not be in keeping with the public trust reposed in them.
September 4, 2011
Mining Engineers’ Conference in Legazpi City blind to local residents’ plight!
We remind the Provincial Government of Albay about the Sangguniang Panlalawigan Resolution 2011-020 issued on March 8, 2011 banning all future mining activities in the province. It should have shown consistency by expressing disfavor against the convention.
We rebuke the City Government of Legazpi for going against the sentiments of Albayanos against the continued destruction of our environment. The city has recently manifested its inability to walk the talk. In Mount Bariw, Barangay Estanza, a large swath of hillside is severely denuded yet it has done nothing. The silt from the denudation has flowed to Barangay Pinaric where it is several inches thick. In Embarcadero, large volumes of floating garbage greet the citizens whenever they go for a leisurely stroll along the boulevard. The city government has been so preoccupied with pleasing tourists but compromised the welfare of local residents who voted them into office and pay millions in taxes. Tourists bring in income but that income is just a means towards providing better living conditions for local residents. The means cannot be exchanged for the end. If the welfare of citizens is disadvantaged by the city government’s preoccupation with pleasing tourists, then it is time to withdraw the trust reposed in them during election.
The hosting of the mining engineers’ convention in Legazpi is a misstep of the city government. It betrays a failure to understand genuine environmental advocacy. While the city brags about its sanitary landfill, it fails to prove its pro-environment agenda by making a prominent endorsement of mining as a stimulant of progress. While we need products derived from mining, we insist that it should be done in the right place and the right manner. That is what responsible mining is all about. So far, however, all claims of responsible mining by many companies are nothing but hot air because of the evident damage wrought on their surroundings like what is happening in Rapu-Rapu, Aroroy, Palanog, Matnog, Paracale, Catanduanes, Caramoan, etc.
They say, if we do not want mining then we should not use the products of that industry. They are dead wrong. We want mining that does not destroy the environment. We want mining that reserves the natural resources of the Philippines for Filipinos. We want mining that spreads the fruits of development to the masses and not only to the foreign investors and their local junior partners.
We want mining that does not sacrifice our agriculture so that we protect our own food supply. Mining generally provides for non-basic needs while agriculture produces our most basic needs like food, clothing, shelter and livelihood. While mining generates a few temporary jobs, agriculture provides long-term sources of income thus genuinely assuring sustainable development.
We call on all mining engineers to support our notion of genuinely responsible mining. In view of the bad record of mining in Bicol, we ask them not to project the impression that they condone what is happening here contrary to declarations by the DENR, MGB, EMB and companies that all is well in Bicol mining. Bicol is severely suffering from the impacts of mining and the statements of the aforementioned entities are belied when we see the plight of the farmers and fishermen and the condition of our mountains, rivers, creeks and seas.
So in their visit to Rapu-Rapu today, they should make an objective assessment on the effects of mining in the island and its residents and not make it a mere field trip. They should talk to the people to know the real impact of RRPP on their lives. They tell us nothing but misery and deepening poverty. While the project heaps billions upon the foreign investors and their local junior partners, it brings “Lilliputian” benefits to the residents of the island and severe fish catch decline in Albay Gulf on which depend some 14,000 fishermen. Today, there is no more fish to catch in the gulf.
In 2010, the project earned P11.7 billion but according to Gov. Joey Salceda himself the province got a social fund of P41.71 million or a measly one-third (1/3) of 1%! If that is not enough, one can look at the creeks flowing from the mine site to the sea. They are colored yellow, orange, red and brown.
We ask the delegates to the mining conference to wake up to realities and not be deceived by the lies of those who support mining operations in Bicol.
July 19, 2011
RRPP’s Awards - Rubbing Salt on the People’s Injury
As the cliché goes, the proof of the pudding is in the eating. One needs only to go to the island and talk to the people to know the real impact of RRPP on their lives. They tell nothing but misery and deepening poverty. While the project heaps billions upon the foreign investors and their local junior partners, it brings “Lilliputian” benefits to the residents of the island and severe fish catch decline in Albay Gulf on which depend some 14,000 fishermen. Today, there is no more fish to catch in the gulf.
In 2010, the project earned P11.7 billion but according to Gov. Joey Salceda himself the province got a social fund of P41.71 million or a measly one-third (1/3) of 1%! If that is not enough, one can look at the creeks flowing from the mine site to the sea. They are colored yellow, orange, red and brown. Challenged to prove his belief in the reports of the Multi-partite Monitoring Team by bathing in the creeks on schedules and sites set by SARA, Director Reynulfo Juan of MGB V, showed photos of people perching on rocks in the discolored creeks on dates and sites they themselves chose. Challenged by SARA to withdraw the armed CAFGUs and allow free access and surprise visits to the creeks, Engr. Rogelio Corpus, President of RRMI, replied that they cannot allow such because they “have to protect their interests.” Hence, the interests of the environment and those of RRPP are contradictory.
The executives of RRPP can go on deluding themselves with fantastic claims of “safe and responsible mining” in Rapu-Rapu but the truth is well-known to the people who suffer much from the environmental damage and economic injustice attendant to the project. The emperor’s new clothes are well-praised by the award-giving bodies. One day, the truth will prevail and the awards will instead shatter their credibility. There is time under heaven for everything, says the Bible. Today, in the island of Rapu-Rapu and villages dependent on Albay Gulf, the people are groaning in pain. The awards are salt rubbed on their wounds while RRPP’s supporters have their photo-ops and raise their toasts of wine in fine dining. We believe that the day will come when, after being denied for so long, the people shall claim justice and RRPP’s awards will go to the dustbin.
July 18, 2011
Noon at Ngayon, Walang Responsableng Dayuhang Pagmimina sa Kabikolan!
Kahiya-hiya at malakas pa ang loob na ang itinakdang tema ng kumperensyang magaganap ay: Towards Responsible Mining: “Against All Odds”. Responsable para kanino? - Para sa mga malalaki at dayuhang korporasyon sa pagmimina kasama ng mga malalaking lokal na negosyante at para sa mga matataas na opisyales ng gobyerno at ahensya na nakikipagsabwatan sa mga korporasyong ito.
Kalokohang sabihin na ang operasyon na Open Pit Mining sa Rapu-Rapu, Albay (Rapu-Rapu Polymetallic Project ng Lafayette/LG-Kollins) at sa Aroroy, Masbate (Masbate Gold Project ng Filminera Resources Corporation) ay responsable! Mayroon bang pagpapasabog (blasting) ng kabundukan at kalupaan na “safe and environmental friendly”? Samantalang winawasak nga at hinuhukay pailalim.
Hindi rin responsable ang Magnetite Offshore Mining ng Bogo Mining Resources Corp. sa limang bayan ng Calabanga, Sipocot, Tinambac, Cabusao at Siruma sa Camarines Sur kung saan hahalukayin ang kailaliman ng karagatan 15 kilometro mula sa baybayin nito.
Hindi kailanman naging responsable ang mga dayuhang korporasyon ng pagmimina sa mga naapektuhan ng kanilang mga operasyon. Simula ng operasyon ng RRPP sa Rapu-Rapu ay lalong lumala ang kahirapan at nagkagutom-gutom ang mga residente dito dahil sa pagbagsak ng kanilang kabuhayan sa pangingisda at pagsasaka dulot ng mga lason ng pagmimina dito. Kung mayroong nakinabang sa binayad ng RRPP na P10,862.85 (mine waste fee) para sa 217,257 tonelada na “mine waste” ay ang MGB-V. (mula sa ulat ng MGB-V,2010). Sampung libong piso! Katumbas ba ito ng isang buhay ng nanay na namatay dahil nakakain ng isda dahil sa fishkill doon o ng isang batang namatay doon dahil sa kagutuman?
Apektado na nga ang mga residente sa pagmimina sa Barangay Nakalaya, Jose Panganiban sa Camarines Norte ay naiipit pa sila ngayon sa kaguluhan at away ng Investwell Corporation at ng FMCGI ng pamilyang Fonacier na nag-aagawan ng yamang mineral ng kanilang lugar.
Kasinungalingang ipamaglaki pa sa ulat ng DENR-V/MGB-V na ang malakihang pagmimina sa Kabikolan ang nagpasigla ng ekonomiya ng rehiyon samantalang ayon sa ulat ay nasa ikalawa sa pinakamahirap na rehiyon ang Bikol sa buong bansa. Kung sinasabi na umunlad ang ekonomiya ng Bikol dahil sa malakihang pagmimina – hindi ito maramdaman ng mga mamamayang Bikolano lalo na ng mga apektado ng mapaminsala at dayuhang pagmimina.
Tanging ang mga malalaki at dayuhang korporasyon sa pagmimina kasama ng mga malalaking lokal na negosyante at mga matataas na opisyales ng gobyerno at ahensya na nakikipagsabwatan sa mga korporasyong ito ang nakikinabang sa mga produkto at kita ng pagmimina dito sa Bikol. Sa ulat ng MBG-V/DENR-V noong 2010, sa kabuuan ay may P4,654,818,424.31 at P57,483,032.45 na kita mula sa “metallic ” at “non-metallic production”dito sa Bikol ayon sa pagkasunod-sunod ngunit hindi naman inulat ang mga dambuhala at limpak na limpak na kita ng mga korporasyon na maluwag na inilalabas patungo sa kanilang bansa. Maluwag nang nailalabas ang kita, maluwag pa ang kanilang operasyon dahil sa mga iba’t-ibang insentibo tulad ng: 6 years income tax exemption, 10 years export tax exemption, and import tax exemption at marami pang iba.
Kaya nga parang parang kabuteng nagsulputan ang mga ito sa Bikol dahil sa pagiging sagana ng rehiyon sa yamang mineral at prayoridad pa ng nakaraang gobyerno ni GMA ito para sa malakihang proyektong pagmimina na ipinagpapatuloy lamang ng gobyerno ni Noynoy Aquino at pinasahol pa sa ilalim ng kanyang Public-Private Partnership Program. Gayundin, patuloy ang pag-iral ng Mining Act of 1995 kung saan ay lalong nagbuyangyang sa ating likas na yaman para dambungin at wasakin ang ating kalikasan.
“Towards Responsible Mining: Against All Odds” ? - Ang responsableng pagmimina ay mangyayari lamang sa ating bansa kung magkakaroon ng re-oryentasyon ang industriya ng pagmimina sa ating bansa. Kung saan, ang kita ng industriya ng pagmimina ay napapakinabangan at napapaunlad ang mamamayang Pilipino at hindi napupunta sa dayuhan at sa mga lokal na kasabwat nito. Kung saan, ang gobyerno ang may kontrol ng industriya at hindi ang mga dayuhan.
Hindi dayuhang pagmimina at malawakang kumbersyon ng lupa ang magpapaunlad sa Kabikolan. Hindi ito ang sagot sa kahirapan at kagutuman ng mamamayang Bikolano. Pagpapaunlad ng agrikultura, trabaho at sapat na sahod, tirahan, libreng serbisyo-sosyal ang tutugon sa kahirapan at kagutuman upang mabuhay ng maayos at marangal ang mamamayang Bikolano. Tunay na Reporma sa Lupa at Pambansang Industriyalisasyon lamang ang magpapaunlad sa bansa at rehiyon.
Hulyo 13, 2011
A Word of Caution
Matthew 7:16 - You will know them by what they do. Thorn bushes do not bear grapes, and briers do not bear figs.
Matthew 7:20 - So then, you will know the false prophets by what they do.
The creeks are crucial to the condition of fishing grounds
The joke is that there will no longer be any fishkill - because there are no more fish to kill.
The fish that allegedly died off the coasts of Linao and Binosawan during the fishkill reported by island residents and the parish on May 8, 2011 could be the migratory species from the Pacific Ocean attempting to enter Albay Gulf via the gap between Rapu-Rapu and Prieto Diaz. Linao is a village facing the ocean and Binosawan, the gap.
The MGB V Photographs and "Bathing" in the Creeks of Rapu-Rapu
"With reference to your challenge to take a bath in the creeks, we have done just that. some members of the MMT and personnel of Rapu-Rapu Polymetallic Project (RRPP) went to a picnic and took a bath at Pagcolbon Creek on March 29 and April 3, 2011. We are attaching pictures for your reference. These pictures indicate the current status of the creeks."
In reply, Mr. Perdigon writes:
The good Director says he believes the contamination data but he is not among those “bathing.” Someone is shown sitting on the rocks (obviously not bathing) but the face is not recognizable (number 10).
Then and Now: What Difference? What Improvement in the Creeks?
Below, we are presenting ALL pictures in the Annex to the EMB V Investigation Report dated March 8-10, 2011. Those on the left are the pictures we have been showing to authorities which were taken from 2006 to 2009; those on the right are alleged to have been taken in the same spots on March 8 to 10, 2011 by EMB V and the mining companies. You be the judge if there is any improvement.
Tuesday, August 4, 2009
SARA refutes RRMI allegations Part 2
There many other issues not addressed by Mr. Corpus. Among these are the following:
1. Unfulfilled SDMP promises; the “lollipop affair" indeed was characteristic of Lafayette mentality towards the people of Rapu-Rapu
2. Employment of members of a government-paid paramilitary unit, Civilian Armed Forces for Geographical Units, (CAFGU) as company guards
3. Continued employment of personnel directly involved in the 2005, 2006 and 2007 toxic spills
4. Implausible explanations for the toxic spills and fishkills
5. Assumption of management by a minor shareholder, Kores and LGI, after the former owner, LML, ran away from its responsibilities; unwillingness of Kores and LGI to assume responsibility for the mistakes of LML; the management change is only a ploy to deflect penalties
6. Token employment of locals with very low salaries and preference for non-residents with higher salaries
7. The island’s small size
8. The steep slopes of its hills thus any poisonous spill will immediately contaminate the creeks and the seas;
9. Heavy rainfall in our area (8-12 inches monthly average from July to December) which will easily fill up any tailings pond
10. Lafayette’s use of the open pit method
11. Turnaround on the promise to pay taxes
The Open Pit
Any open pit exacerbates global warming for the following reasons:
Trees and other forms of vegetation (which produce a net supply of oxygen) are removed. The silt from the mine site is carried by rainwater to the sea and kills the plankton which produces 50 to 70% of the earth’s oxygen supply by consuming carbon dioxide.
The following quotation from EMB V Regional Director Gilbert Gonzales is insightful:
Mining industries are a major source of greenhouse gases which pollute the environment, as Gilbert Gonzales, regional director of the Environment Management Bureau (EMB) of the Department of Environment and Natural Resources in Bicol explained. “Mining operations are major emitters of greenhouse gases to the environment because of the chemicals they’re using,” Gonzales said.
Reference: Mining emits greenhouse gasesBy Rhaydz B. Barcia, Correspondent, Manila TimesMonday, October 22, 2007
http://www.manilatimes.net/national/2007/oct/22/yehey/prov/20071022pro1.htmlApril 21, 2008
The Turnaround on the Promise to Pay Tax
The total cost of social development and livelihood program of Lafayette was made attractive to the people of Rapu-Rapu and even the entire Bicol Region with promises made through a press release titled “Simbag kan Lafayette Philippines, Inc. (LPI) sa mga Isyus Unong sa Operasyon Kaini sa Banwaan kan Rapu-Rapu” in the Albayano Examiner in its November 19-25, 1999 issue, among which was the payment of taxes to the local government unit.
In a sudden and treacherous turnaround, Lafayette reneged on its promise. The company applied for exemption from local taxes under the government’s PEZA program. It went through a dubious process as the documents show. In December 2003 Lafayette applied for tax exemption under the Philippine government’s PEZA program. On May 4, 2004, the application was approved by the President of the Philippines through Proclamation No. 625.
A certain Resolution 150-2003 purportedly passed by the Rapu-Rapu Sangguniang Bayan (municipal council) on November 19, 2003 was flaunted by Lafayette as evidence that the former had consented to the declaration of the mine site as a Special Economic Zone. The document was fake and its source is unknown up to this time.
In a letter Mr. Allan Asuncion, Secretary of the Sangguiang Bayan, pointed out that a closer look at the document reveals the following:
1. The signature of Councilor Batas is rubberstamped as indicated by the doubling of strokes.
2. The signature of the Mr. Asuncion is also fake as it is different from those appearing in other documents he truly signed.
3. The date of adoption of the resolution is ONE MONTH LATER than its date of approval.
4. The resolution does not have a letter of transmittal from the Sanggunian Secretary.
5. The resolution is printed not on the official stationery of the Sanggunian.
6. The resolution is not dry sealed.
According to Proclamation No. 625, Lafayette will pay:
the government share of two percent (2%) of “the actual market value of the gross output thereof at the time of removal, in the case of those locally extracted or produced” under the Mineral Production Sharing Agreement (Memorandum from Atty. Marwil N. Llasos of the Office of the President to the Rapu-Rapu Fact-Finding Commission dated May 2, 2006)
the tax of one percent (1%) of gross income to be remitted first to the national government before it is distributed to the local government unit (Section 24 of R.A. No. 7916)the tax of one percent (1%) “for the establishment of a development fund to be utilized for the development of municipalities outside and contiguous to each ECOZONE” (Section 24 of R.A. No. 7916)
Ordinary citizens of the Philippines are taxed based on GROSS INCOME. For some taxpayers, the amount of income tax is about two months of their annual earnings. The remaining ten (10) months of income is subjected to EVAT of 12%. As a result, an ordinary taxpayer pays an equivalent of three (3) months of his annual income. In effect, the 13th month pay is merely for taxpaying purposes. All considered, the tax paid is 3/13 or 23.08% of GROSS INCOME while Lafayette pays 7% of NET INCOME (5% under RA 7916, 2% under the MPSA). Of the 7%, only 2% purportedly goes to the local government unit. However, this 2% is further reduced through the labyrinthine operation of our taxation system.
Non-mining corporations pay as much as 32% of NET INCOME as required under the National Internal Revenue Code. The lowest tax rate on other corporations is 15% as stated in Chapter V Section 27 paragraph 4 of the Code.
But there is more . . .Lafayette will never have to pay any income tax because under the Implementing Rules and Regulations of the Special Economic Zone Act (RA 7916) they have six (6) years of tax holiday extendable to eight (8) years.
RULES AND REGULATIONS TO IMPLEMENT REPUBLIC ACT NO. 7916, OTHERWISE KNOWN AS “THE SPECIAL ECONOMIC ZONE ACT OF 1995”Rule XV Section 6A. Income Tax Holiday
1. Period of Availment - New ECOZONE Export or Free Trade Enterprises shall be fully exempt from income taxes levied by the National Government for the period as follows:
a. New Registered Pioneer Firms - Six (6) years from commercial operations.
b. New Registered Non-Pioneer Firms - four (4) years from commercial operations.
c. Expanding Firms - Three (3) years from commercial operation of the expansion.
6. Additional Period of Availment - For ECOZONE Export or Free Trade enterprises, the income tax holiday incentive may be extended for an extra year in each of the following cases but in no case to exceed a total period of eight (8) years for pioneer registered enterprises:
a. If the ratio of the total imported and domestic capital equipment to the number of workers for the project does not exceed US$10,000.00 to one worker, or as prescribed by the Board;
b. If the average cost of indigenous raw materials used in the manufacture of the registered product is at least fifty percent (50%) of the total cost of raw materials for the preceding years prior to the extension unless the Board prescribes a higher percentage;
c. If the net foreign exchange savings or earnings amount to at least US$500,000.00 average annually during the first three (3) years of operations to be determined by the Board at the end of such three-year period:
Provided, That the foregoing foreign exchange savings criterion shall apply, as a general rule, to ECOZONE Export or Free Trade Enterprises whose products are totally imported into the country at the time of registration and duly indicated as imports substation in firm’s approved project proposal.
For the purpose of availment of this incentive, the ECOZONE Export or Free Trade Enterprise shall apply in writing to PEZA for the additional period and shall submit proof of compliance with the criteria above-mentioned.
7. Determination of Pioneer / Non-Pioneer Statusa. Investment Priorities Plan - As a general policy, the basis for determining whether an area of economic activity may be considered pioneer or non-pioneer shall be the Investment Priorities Plan prepared yearly by the Board of Investments. In the absence thereof, the applicable criteria shall be formulated by PEZA.
In a press release, Lafayette announced the extension of the mine life from six (6) to eight (8) years. No wonder Lafayette has programmed its operations for a mine life of (guess what) EIGHT YEARS !
In the light of all these information, what is Lafayette saying?
LAFAYETTE VOWS TO PAY MORE IF TAX LAWS AMENDED
Lafayette's Rapu-Rapu Polymetallic project has been paying its taxes religiously and is ready to pay more if Congress amends the law to raise taxes on mining companies.
This statement deviates from the core of the accusation against Lafayette re tax payment. THE COMPANY PROMISED TO THE PEOPLE OF ALBAY IN 1999 AND 2001 TO PAY BILLIONS OF PESOS IN TAXES BUT IN 2004 IT APPLIED FOR TAX EXEMPTION UNDER THE SPECIAL ECONOMIC ZONE ACT. The issue is not the law but the sincerity of the company. Lafayette may be legal in its much reduced tax payments but it is immoral in making the Albayanos expect billions of pesos and then use the law to break the promise. It is also immoral in using a perjured document to apply for exemption.
Lafayette is not even among the top ten (10) tax paying corporations in the Bicol Region as a letter from the BIR Regional Office V dated February 18, 2008 proves.
We asked BIR Legazpi office for the list of the top ten taxpaying corporations in 2008 but this time the regional director replied that issuing such a document is against the law on divulgence of trade secrets!?
(Please see continuation.)