Tax reform the priority when Congress returns from break

THE House of Representatives Ways and Means Committee plans to focus on the Comprehensive Tax Reform Program (CTRP) when the congressional session resumes next month.

Ways and means committee Chairman Rep. Dakila E. Cua said yesterday that the committee will start to review the first package of the proposed CTRP, which was submitted by the Department of Finance (DoF) on September 26.

“Upon resumption, we intend to give the tax reform package priority,” he said in a text message.

The first tax reform package aims to increase the take-home pay of lower and middle-income workers by lowering personal income tax rates to up to 25% from the current 32%, and increasing the value-added tax (VAT) base.

Finance Undersecretary Karl Kendrick T. Chua has said that only the top 1% of earners will see their income decrease, while the rest of the 99% will take home more pay. The first package also includes adjustments to the excise taxes on petroleum and automobiles, and indexing them to inflation.

The DoF said that the first package will generate P174.2 billion in revenue in the first year of its implementation, with some parts to be used in targeted transfer programs for the country’s most vulnerable sectors.

Mr. Cua added that he hopes to submit the tax reform bill to the Senate before the next sine die adjournment on March 18.

The DoF said that succeeding tranches of the tax reform program will be submitted to Congress after the implementation of the first package, which they hope to be operational in 2018.

The next packages to be proposed in the CTRP include plans to tax sugary drinks, expand the sin tax law, and ease of the bank secrecy law.