Benguet towns to settle share with Philex

BAGUIO CITY—The Benguet towns of Itogon and Tuba have started talks over a financial sharing arrangement with Philex Mining Corp., after the gold producer decided to honor its tax obligations with the local governments, Itogon Mayor Oscar Camantiles said.

During a news conference in Itogon last month, Philex officials said they confirmed with the firm’s accountants that Philex had unpaid business and building permit fees.

Part of the payment, some P29 million, had been deposited under an escrow account. It would cover regulatory fees for business operations in 2011, said Philex legal counsel Eduardo Aratas.

Philex operates the Padcal mine, which straddles Itogon and Tuba. As the firm’s oldest operation, Padcal was supposed to be decommissioned in 2011. But due to the strong world metals trade, the company extended its operations to 2020.

According to Tuba Mayor Florencio Bentrez, the two towns have an equal sharing agreement over shares from Philex excise taxes, but the deal does not include revenues from permits.

Philex has been hounded by demand letters issued by Camantiles, who pursued the back taxes dating back to 2002. The tax obligations amount to P542,277,452.94 after auditing the town’s receivables.

During the Philex news conference, Aratas said it confirmed some of Camantiles’ findings and started processing the permits for three new structures.

“As a sign of goodwill, we also unearthed other facilities with no permits and we began processing their papers. Going toward a world-class mine, we want our documents and our legal processes to be untarnished,” Aratas said.