PCCI, DoF to hold nationwide tax reform caravan

AS PART of the administration’s 10-point Socioeconomic Agenda for inclusive growth, the Philippine Chamber of Commerce and Industry (PCCI) and the Department of Finance (DoF), with the support of the USAID’s Facilitating Public Investments Project (FPI), will hold a series of information campaign on Package 2 of the Comprehensive Tax Reform Program (CTRP), which covers corporate income tax and rationalization of the fiscal Incentives.

The tax reform road show is part of the Open Government and Participatory Governance Regional Dialogues initiated by the Participatory Governance Cluster (PGC) led by the Department of Budget and Management (DBM) and Department of Interior and Local Government, which will run from January to March 2018.

PCCI President Ma. Alegria S. Limjoco welcomed the initiative as a platform to solicit and generate business sentiments and positions on the proposed tax measure.

“We thank the DoF and the USAID-FPI for getting PCCI again as their partner in rolling out this campaign. We fully recognize the efforts of government to raise revenue to support its infrastructure projects and we hope that the proposed measure, once passed into law would be beneficial for everyone.”

Edgardo Lacson, PCCI’s director for Taxation, pointed out that lowering the corporate income tax is the rational next step after the reduction of personal income taxes. He said: “We cannot discount the fact that our country has the highest corporate income tax rate (both nominal and effective) in ASEAN. There is a need to reduce the rates to a level that will make us competitive in a field of countries competing for the same direct investment funds.”

On the fiscal incentives, tax expert and Chair of PCCI’s Taxation Committee, Atty. Benedicta DuBaladad agreed that the country needs to rethink its investment tax policy. She said that while the business community lauded the passage of the Tax Incentives Management and Transparency Act or the TIMTA in 2016, she said it is high time the granting of tax incentives is rationalized to remove the redundancies and make incentives clearer and more accountable.

To ensure widespread dissemination, the tax caravan is scheduled in the following areas, Bacolod City (Jan. 31), General Santos City (Feb. 7), Subic/Clark (Feb. 13), Cebu City (Feb. 16), Zamboanga City (Feb. 21), Makati City (Feb. 28), Baguio City (March 7) and Tacloban City (March 23).

DoF Undersecretary Karl Chua and Assistant Secretary Teresita Habitan will lead the panel of speakers from government, while Atty. Baladad and Tomasa Lipana, co-chair of the PCCI Tax Committee, will be representing PCCI and the business sector. Legislators from both Senate and House of Representatives have also been invited to speak.

Before the end of 2017, President Rodrigo Duterte enacted into law the Tax Reform for Acceleration and Inclusion (TRAIN) Act or RA 1096, which amends the current tax code by lowering personal income tax and increasing excise levies on consumption goods such as petroleum products, automobiles, sugar sweetened beverages, cosmetic surgery, coal, and minerals.