Sin tax review, TRAIN package 2 among DoF’s legislative priorities
LOWERING corporate taxes, rice tariffication, the national identification system, and the sin tax law review will be the Finance department’s focus areas in legislation next year.
Finance Secretary Carlos G. Dominguez III said that he has met with leaders of Congress regarding the bills the Department of Finance (DoF) wanted to push.
“We told them that we will be really focusing on package two which is lowering corporate income taxes together with reviewing fiscal incentives. We will also support review of the sin tax law for both alcohol and tobacco. Tariff ication of rice, those would be our areas of focus,” Mr. Dominguez told reporters on Thursday.
“The other one that we want to push also is the National ID that is very key to the whole mobilization of the Philippine society,” he added.
Those already in the legislative mill are the Amendments to the Agricultural Tariff ication Act of 1996 and the Unified National Identification System Act — which both were identified as priority bills by the Legislative-Executive Development Advisory Council for the 17th Congress.
The lifting of the quantitative restriction system on rice and its replacement by a set of tariffs, which would require amendments to Republic Act 8178, is currently awaiting a report from the Committee on Agriculture and Food at the House of Representatives.
The measure, filed as House Bill 4904, authorizes the President to set import duties on the staple grain upon the expiry of the country’s waiver for the special treatment on rice granted by the World Trade Organization on July 1.
Such a move would make domestic prices more competitive, while revenue from the tariffs will go to farmers to improve their productivity or shift to high-value crops.
The Philippine National Identification System under House Bill 6221 on the other hand has been approved by the lower chamber of Congress on September, and is currently undergoing committeelevel discussions in the Senate.
The ID will help plug the leaks in the government’s social welfare programs, identifying qualified beneficiaries for cash transfers, discounts of transportation, and health care, among others.
The DoF also aims to submit to Congress the second package of the comprehensive tax reform program.
It will consist mainly of a cut in corporate income tax to 25% from 30% currently, in order to encourage companies to spend more and to improve the country’s attractiveness to foreign investors.
At the same time, it will rationalize income tax incentives for firms given by a number of investment-promotion agencies such as the Board of Investments ( BoI) and the Philippine Economic Zone Authority (PEZA), making the measure revenue-neutral.
Meanwhile, the Senate filed a resolution in February for the mandated legislative review of Republic Act 10351, or the sin tax law, to assess the effectiveness of a unitary tax system in reducing alcohol and cigarette consumption before considering any amendments to the law.
The Finance department has scheduled the reform of tobacco and alcohol excise taxes for the fifth package of the comprehensive tax reform program, due in the second half of 2018. —