President Marcos Signs Enhanced Fiscal Regime for Large-Scale Metallic Mining Act into Law
Jollie Anne Las Piñas
Manila, Philippines | September 4, 2025
President Ferdinand R. Marcos Jr. today signed Republic Act No. 12253, or the “Enhanced Fiscal Regime for Large-Scale Metallic Mining Act,” during a ceremony at Kalayaan Hall, Malacañang Palace. The new law introduces a modernized mining fiscal regime designed to ensure that the Filipino people receive a fairer share of revenues from the extractive sector while strengthening transparency, accountability, and governance.
The measure establishes a tiered royalty and windfall profits tax system to replace the outdated, uniform mining levies. Among its key features are:
- Tiered Royalty Regime. A five‑tier royalty of 1 % to 5 % on income from metallic mining outside mineral reservations, with a 0.1 % minimum royalty for lower‑margin operations. Mines inside reservations continue to pay a 5 % royalty.
- Windfall Profits Tax. A five‑tier tax of 1 % to 10 % on profits above a 30 % margin, ensuring the government captures extra earnings during boom periods.
- Thin Capitalization Rule. A 2:1 debt‑to‑equity cap on related‑party borrowing to curb tax‑deductible financing costs.
- Ring‑Fencing. Project‑by‑project tax accounting to prevent losses in one mine from offsetting profits in another, closing a loophole long exploited by large operators.
- Local Business Tax. Clarification that mining contractors’ local business tax rate is 0.5 %.
- Revenue Sharing and Governance. 40% of mining tax collections will go directly to host local governments, and 10 % of royalties from mineral reservations will fund exploration, mineral valuation laboratories, and capacity‑building for the Mines and Geosciences Bureau (MGB) and the Metals Industry Research and
Development Center. The law mandates public disclosure of mining data and joint BIR‑BOC audits of mineral sales.
The Department of Finance projects that these reforms will generate an additional ₱25.08 billion in revenues from 2026‑2029, or roughly ₱6.26 billion annually.
Transparency and Accountability
The law also contains a landmark Transparency and Accountability provision requiring the disclosure and public scrutiny of extractive industry data. This covers not only tax and non-tax payments, but also beneficial ownership records, natural capital accounting data under the PENCAS Act, revenue and expenditure flows, and company filings such as the General Information Sheet with the Securities and Exchange Commission.
It establishes a multi-stakeholder mechanism to oversee this process, ensuring participation from government, industry, and civil society. From the perspective of transparency reform, this is highly significant: practices that were once voluntary are now institutionalized in law, providing a stronger guarantee that mining revenues and company data will be accessible, verifiable, and accountable to the public.
Commitment to Responsible Mining
In his keynote address, President Marcos framed the signing as a pledge to responsible mining and intergenerational equity. He noted that the Philippines is rich in critical minerals essential for renewable technologies and stressed that “we must make sure that our mining infrastructure is robust and that Filipinos, above all, benefit from it.” He emphasized that the new regime is “fairer, clearer, and more responsive to the needs of both our people and the environment,” adding that it will simplify tax administration, guarantee government share, and provide certainty for investors. “Gone are the days when a mining contractor can bury its profits beneath the weight of losses,” he declared. “Transparency is now the rule, accountability our standard, and fairness the measure by which we move forward”.
Finance Secretary Ralph G. Recto reminded stakeholders that the law is rooted in stewardship. He said the government intends to “transform the country’s natural resources into a key driver of national growth, attracting more sustainable investments, generating more jobs, and boosting revenues to support quality public services.” He prayed for wisdom to implement the law “patas, walang takot at walang kinikilingan” (fairly, fearlessly, and without favor), underscoring the government’s responsibility to both the environment and future generations.
Legislative Journey
- September 25, 2023 – The House of Representatives approved HB 8937 on third reading, transmitting it to the Senate two days later.
- February 3, 2025 – The Senate passed SB 2826 on third reading, adopting a five‑year grace period before implementing an ore export ban to allow investment in domestic processing.
- 11 June 2025 – A bicameral committee reconciled differing provisions and ratified the consolidated bill.
- 31 July 2025 – The House sent the enrolled bill to the Office of the President.
- 4 September 2025 – President Marcos signed the measure into law at a ceremony attended by congressional leaders, Cabinet secretaries, and industry stakeholders.
Republic Act No. 12253 positions the Philippines to become a responsible supplier of minerals in the global green‑energy value chain while safeguarding the rights of communities and the environment.
By strengthening fiscal rules, enhancing transparency, and reinvesting in exploration and research, the Enhanced Fiscal Regime for Large‑Scale Metallic Mining Act aims to unlock the sector’s potential in a way that “never comes at the cost of our people nor our planet,” as the President concluded.
A government-led, multi-stakeholder initiative implementing EITI, the global standard that promotes the open, accountable management, and good governance of oil, gas, and mineral resources. PH-EITI was created on 26 November 2013 through EO No. 147, s. of 2013. It is a government commitment first announced through EO No. 79, s. of 2012.