FINANCE SECRETARY Carlos G. Dominguez III said the government is focused on saving jobs and ensuring workers are paid during the COVID-19 outbreak, and does not consider tax breaks a priority.
“I have told the people who came out with that proposal to do a stimulus package — that is not our priority at the moment… we don’t even know what the point is of giving tax credits and stimulus packages when you have no workers. What’s the point? The workers are in quarantine… Let’s talk about that later,” Mr. Dominguez told reporters Wednesday via Google Meet.
He said the government’s focus is to support Filipinos who lost their livelihoods, protect front-liners and the health care system, as well as boost the economy.
“The first part of the battle, we must take care of the essentials and then as the battle develops, we will take a look at the damage to the economy and therefore that’s the time when we will plan on what we are going to do for the stimulus program. But now, I think we are still in the assessment stage,” he said.
The Makati Business Club on Monday urged the government to implement financing programs and stimulus packages to help businesses, especially micro, small and medium enterprises (MSMEs), stay afloat during the crisis.
Before Congress approved Republic Act No. 11469, or the “Bayanihan to Heal as One Act,” the group said in a statement: “we suggest the Administration and Congress consider… providing rehabilitation, special financing programs and/or stimulus package to help businesses — especially MSMEs — that are adversely affected by the COVID-19 pandemic, especially to help them pay workers to remain quarantined and, when the pandemic is under control, to rehire and resume normal operations.”
According to Mr. Dominguez, the government “doesn’t know exactly what the total damage is, but there is damage. So, we’ll attend to the immediate emergency which is to provide livelihood, to provide safety equipment and provide general support to the economy. But for the specifics I don’t know yet this time.”
According to the law, 18 million low-income families will receive emergency subsidies worth P5,000 to P8,000 per month for two months. A “COVID-19 special risk allowance” will also be given to public health workers and additional compensation for all health workers who contract the disease.
Meanwhile, the law also provides for the liberalization of incentives for manufacturing or importing needed equipment and supplies for health workers fighting the outbreak, as well as ensuring that credit is available to “productive sectors” during the crisis.
Mr. Dominguez has said the government is currently seeking up to $2 billion worth of funding assistance from multilateral agencies to support the government’s increased spending and plug the funding gap. Economic managers expect revenue to drop by around P318.9 billion this year for every percentage-point contraction in economic growth.
Separately, Mr. Dominguez also urged his fellow governors at the Asian Development Bank (ADB) to give President Masatsugu Asakawa more leeway as the multilateral lender addresses its member-countries needs during the global health crisis.
“Extraordinary times call for extraordinary measures. A certain degree of discretion ought to be provided to the President on administrative matters, such as allocating the Bank’s budget and authority to approve crisis-related programs and projects, within reasonable limits,” Mr. Dominguez said in his letter to the other 67 ADB governors.
The government rolled out an initial P27.1-billion economic stimulus package to help virus-affected sectors while the recently-signed law allows the government to realign as much as P275 billion from the national budget and make off-budget outlays to the emergency subsidy program.
The World Bank has committed to provide a $100-million loan to the Philippines while the ADB has extended a $3-million grant.
Economic planners expect losses of between P428.7 billion to P1.355.6 trillion in gross value added, equivalent to 2.1-6.6% of gross domestic product, due to the economic impact of COVID-19. — Beatrice M. Laforga