Ex-DOF chiefs back tax reform Package-2
Former finance ministers and ranking officials threw their support behind the Duterte administration’s second proposed tax reform package that aims to lower the corporate income tax (CIT) and “modernize” or capped investment incentives.
Aimed to ensure a “fair, competitive and growing” business sector in one of Asia’s fastest expanding economies, 10 former secretaries and undersecretaries of the Department of Finance (DOF) supported the second tax reform package now pending in Congress.
Former Finance Secretaries Roberto de Ocampo, Salvador Enriquez, Margarito Teves, and Alberto Romulo, along with former DOF Undersecretaries Romeo Bernardo, Lily Gruba, and Cornelio Gison personally gave their formal support to Finance Secretary Carlos G. Dominguez III. The tax reform proposal comprising Package-2 of the government’s Comprehensive Tax Reform Program (CTRP) was discussed by Dominguez with the former DOF officials during a meeting last Friday.
Although not present, former Finance Secretaries Cesar Purisima and Jose Pardo also relayed their support for Package-2, while Jose Isidro Camacho joined the show of solidarity for the tax reform proposal via a teleconference call during the meeting.
In their joint statement of support, the former DOF officials said they deem the reforms in corporate taxation and investment incentives as a “fair and well-crafted” proposal.
“It encourages equitable and inclusive growth, a competitive business environment, and strong countryside development,” they cited.
They said that while corporate tax rates must be reasonable, investment incentives, in turn, must ensure that “their economic benefits outweigh the costs of foregone revenues” and should be aligned with the government’s socioeconomic priorities.
“We therefore express our strong support for Package-2 and urge members of Congress to ensure its timely passage,” they said in their joint statement read by Teves in a briefing with finance reporters late Friday.
The proposed reforms under Package-2 is now pending in the Congress as House Bill No. 7458, which was filed last March by House ways and means committee chair Dakila Carlo Cua, Deputy Speaker Raneo Abu, and Deputy Majority Leader Aurelio Gonzales Jr.
During the meeting, Dominguez thanked them, along with their former colleagues in the DOF and the National Economic and Development Authority (NEDA) for backing Package-1 of the CTRP now known as the Tax Reform for Acceleration and Inclusion Act (TRAIN) 1.
Dominguez also thanked the former DOF officials for their “second show of solidarity” in favor of Package-2 of the CTRP.
He said Package-2 will help strengthen the gains that the government has earned in terms of helping fund its aggressive “Build, Build, Build” infrastructure program, further improving its sovereign credit ratings, ensuring fiscal stability and attracting investments.
“It will enable governance of the various incentive programs through the Fiscal Incentives Review Board. We will ensure full transparency and accountability for the incentives. We want all incentives to be performancebased,” Dominguez said.
“These, I feel, will not be too much to ask, considering we gain a more efficient domestic market in return,” he added.