BUSINESS GROUPS questioned proposals to lower corporate income tax in phases, saying that the cuts could come sooner.
Philippine Chamber of Commerce and Industry (PCCI) President Ma. Alegria Sibal-Limjoco said tax reforms contained in the second package of legislation put forward by the government, known as the Tax Reform for Attracting Better and High-Quality Opportunities (TRABAHO) bills which were left unpassed by the last Congress, call for phased reductions in corporate income tax (CIT) which she said the government should consider implementing sooner.
“There is the lowering of the corporate income tax… why 10 years? Maybe (the cuts) can come (over a shorter period),” she said in a text message following the government’s Pre-State of the Nation Address (SONA) economic briefing at the Philippine International Convention Center.
The House version of the TRABAHO bill intends to cut CIT to 20% from 30% by 2029 while the Senate version proposed to reduce it to 25% on the first year.
She noted that the main question about TRABAHO now is its ability to hurdle Congress, with a new set of legislators taking over effective yesterday as the term of the 17th Congress expired.
“The big question now is in proceeding with BBB (Build, Build, Build), what are the alternatives with Package 2 appearing to have difficulty passing Congress.”
Commenting on the government’s reforms so far, she said businesses support earlier components of tax reform and looks forward to “other infra (infrastructure initiatives)… for water and sanitation, waste management including waste to energy facilities, disaster resilient infra,” she added.
The American Chamber of Commerce of the Philippines, Inc. (AmCham) also cited underdeveloped sectors that could be given more attention.
In a text message, AmCham Senior Adviser John D. Forbes said, “The forum correctly highlighted much of the progress and success of the current administration, especially in fiscal management and hard infrastructure. In the future it would be interesting to hear more information on programs to make the poorly-performing agricultural sector reach its potential.”
The Philippine Exports Confederation, Inc. also sought more information regarding the implementation of the mandatory e-invoicing under the first tax reform law, known as TRAIN, and support for micro, small and medium enterprises (MSMEs).
In an interview, PHILEXPORT President Sergio R. Ortiz-Luis Jr. said, “We were looking for…pronouncements to support MSMEs… especially as the labor related policies that have been approved will hurt MSMEs.”
“For the exporters, we’re looking at the implementation of e-invoicing of TRAIN 1… e-invoicing is critical to facilitate tax reforms,” he added. — Katrina T. Mina
