Senate’s Package 1-B report expected next week — DOF

Tax administration measures

The Department of Finance (DOF) is confident that Congress can pass the Duterte administration’s proposed tax administration measures under the first tax reform law before March this year.

Finance Undersecretary Karl Kendrick T. Chua said that the Senate is expected to come up with the committee report on the second Tax Reform for Acceleration and Inclusion Act (TRAIN), or the so-called “Package 1-B,” next week.

Chua said that Package 1-B will no longer require approval of the House of Representatives, noting the remaining measures are already incorporated in the lower chamber’s approved-tax reform version, or House Bill No. 5636.

After next week, the DOF official said the Senate ways and means committee will then submit the report for plenary deliberations.

The DOF’s Package 1-B involves the proposed estate tax amnesty, general amnesty, motor vehicle user tax as well as relaxation of bank secrecy and automatic exchange of information.

The DOF expects roughly R38.9 billion in additional revenue from the second part of the TRAIN.

“Senate said next week, when they resume, they will prepare the committee report, and that committee report will be four-in-one — estate amnesty, general amnesty, bank secrecy relaxation and the automatic exchange of information,” Chua told reporters.

“Once they filed the committee report, the Senate will tackle it in plenary and then bicameral conference committee,” he added.

Chua, however, clarified that the motor vehicle users charge will be tackled separate from package 1-B by Congress.

Asked when the DOF expects the Congress to pass its package 1-B, Chua said “they said within the first-quarter, it will be enacted.”

“Once we have the committee report, the plenary of the Senate will debate and amend and then they will pass its version and then they will enter into bicameral again to reconcile the House and the Senate,” Chua said.

Earlier, Finance Secretary Carlos G. Dominguez III said the tax reform law approved last month was just the initial phase of the first comprehensive tax reform program (CTRP) package.

Based on a document obtained from the DOF, preliminary estimates on TRAIN 1-A showed that it would generate only R90 billion in net revenue, or R38 billion short against the target of around R130 billion.

“Congress has passed two-thirds of the needed revenue this year and is expected to pass the balance in early 2018. In the coming months, we shall be proposing to Congress the next installment,” Dominguez said.