Bill giving agri pensions refiled

September 12, 2022 | 8:42 pm

Fisherman-DavaoGulf-BWFILE — BW FILE PHOTO

A BILL that seeks to give retired farmers and fisherfolk pension amid a coronavirus pandemic has been refiled at the Senate.

“Even before the pandemic hit, the quality of life of our farmers and fishermen was already low,” Senator Manuel “Lito” M. Lapid said in statement in Filipino on Monday. “It was made worse by the strict health protocols and long lockdowns that further weakened their livelihoods.”

The poverty incidence among farmers and fishermen was 31.6% and 26.2% in 2018, among the highest of any sector, the senator said, citing data from the local statistics agency.

“Since we recognize the contribution of the agricultural sector in providing viable employment and unforgivable contributions to national development, now, more than ever, the government must show its concern for our farmers and fishermen who have been forgotten for a long time,” he added.

Senate Bill 1230 or the proposed Agricultural Pension Fund Act will set up a pension program to improve the lives of farmers and fishermen and promote rural economic development.

The creation of an Agricultural Pension Fund will ensure underprivileged farmers, agrarian reform beneficiaries, agricultural workers and fisherfolk are protected upon retirement and in case of disability.

The measure includes retirement benefits of at least P1,500 monthly and at least P18,000 in death benefits to a beneficiary. — Alyssa Nicole O. Tan

Bill to expand senior discounts from power, water

September 12, 2022 | 8:42 pm

A SENATOR has filed a bill expanding the electricity and water consumption discounts for senior citizens.

Under Senate Bill 1066 or the proposed Expanded Senior Citizens Act of 2022 by Senator Grace Natividad S. Poe-Llamanzares, a minimum 5% discount will be given to the elderly on the first 150 kilowatt hours (kWh) and the first 50 cubic meters of their power and water consumption.

They will also be exempted from the value-added tax for these services.

The measure will amend the Expanded Senior Citizens Act of 2010.

Mr. Poe, who heads the Senate committee on public services, said the law limits the 5% discount to seniors whose consumption does not exceed 100 kWh of electricity and 30 cubic meters of water.

“In other words, if a senior citizen consumes, say 100.1 kWh or 30.1 cubic meters of water, he would no longer be entitled to the 5% discount,” she said. — Alyssa Nicole O. Tan

Senate urged to probe abductions

September 12, 2022 | 8:41 pm

TWO senators on Monday filed separate resolutions seeking to probe rising kidnapping incidents in the country.

Senator Mary Grace Natividad S. Poe-Llamanzares in Senate Resolution 195 urged the Senate public order committee to conduct an inquiry, in aid of legislation, of abductions in Metro Manila and Luzon.

“There is an urgent need to determine the status of these cases, possible motives, agency efforts to identify the perpetrators and the measures instituted by relevant authorities to prevent the continuous rise of abductions in the country,” she said.

“There is also a need to ascertain the claims that foreign nationals are conducting these criminal activities,” she added.

Ms. Poe cited reports that kidnappers have been using a white van, grabbing and dragging victims from streets into their vehicles, supposedly for organ harvesting.

There have been at least 56 kidnapping incidents involving Filipino and Chinese nationals in just 10 days, the senator said, citing Philippine Chinese Chamber of Commerce and Industry, Inc. President Lugene Ang.

Senator Joseph Victor G. Ejercito also filed Senate Resolution 194, urging the same Senate to probe kidnapping incidents.

He said most of these involved women and Chinese nationals who work in local gaming companies that operate offshore.

“Though the incidents of alleged kidnappings and killings involved foreigners, there is no assurance that Filipinos will not be a target of these evil deeds,” he said in the resolution. “The government should act swiftly to put an end to this spate of kidnappings and killings.” — Alyssa Nicole O. Tan

PCSO remits P2.5B to Treasury

September 12, 2022 | 8:41 pm

THE PHILIPPINE Charity Sweepstakes Office (PCSO)on Monday said it had remitted P2.5 billion to the National Treasury to boost the country’s universal healthcare law.

The money that will be allotted to the Philippine Health Insurance Corp. (PhilHealth) came from revenues from gaming operations including small town lottery games, PCSO General Manager Melquiades A. Robles told a news briefing.

“This is just the first among the remittances that we will do because, under the law, 40% of our charity fund will have to go to universal health care,” he said.

Under the law, 40% of the agency’s charity fund and half of the National Government’s share from the income of the Philippine Amusement and Gaming Corp. must be used to fund universal health care.

The law, which automatically enrolls Filipinos in state insurer PhilHealth, seeks to give Filipinos access to different medical services. It mandates PhilHealth to cover consultation fees, laboratory tests and other diagnostic services. — Kyle Aristophere T. Atienza

DoE to investigate forced outages that raised red alert over Luzon

September 12, 2022 | 8:31 pm

THE Department of Energy (DoE) said it will investigate the forced outages at seven power plants which caused the Luzon grid to declare a red alert on Monday.

“We assure the public that the DoE is verifying the cause of the forced outages this morning as there appear to be no fuel supply constraints. A team from the DoE will conduct actual physical spot checks and validate the condition of the transmission lines and the affected power plants,” Energy Secretary Raphael P.M. Lotilla said in a statement issued via Viber.

The National Grid Corp. of the Philippines (NGCP) declared red and yellow alerts over the Luzon grid on Monday after seven power plants experienced forced outages as three plants operated below capacity, taking a combined 3,627 MW off the grid.

The grid operator said that the capacity available on Monday was 10,727 megawatts (MW), while peak demand was estimated at 10,585 MW.

The NGCP placed the Luzon grid on red alert between 1 and 4 p.m. on Monday. The yellow alert was declared twice for between 9 a.m. and 1 p.m., and again between 5 and 8 p.m.

NGCP issues yellow alerts when reserves fall below a designated safety margin. Red alerts are issued when the supply-demand balance worsens further, signaling the prospect of rotational brownouts.

Manila Electric Co. (Meralco) said it has notified its interruptible load program (ILP) participants following the NGCP announcement.

“We are ready in the event the implementation of manual load dropping (MLD) or rotating power interruptions will be needed as part of our responsibility to manage the system,” Meralco said.

The ILP counts among its participants large power users that have their own capacity to generate power. These entities stop drawing power from the grid for a time, while relying on their own power plants for their needs, reducing the load on the grid.

The NGCP said that it is on standby to implement MLD in the service areas of the Ilocos Sur Electric Cooperative, Inc.; Isabela I Electric Cooperative, Inc. (Iselco I); Iselco II servicing parts of Ilagan; Batangas II Electric Cooperative, Inc.; Sorsogon I Electric Cooperative, Inc. (Soreco I); Soreco II; and Meralco.

The NGCP said the resort to MLD may be canceled if demand turns out to be lower than projected. — Ashley Erika O. Jose

Philippines calls for ‘needs-based’ priority system for climate finance

September 12, 2022 | 8:25 pm

Flood-climate change — PHILIPPINE STAR/KRIZ JOHN ROSALES

THE Environment Secretary called access to climate finance an urgent matter and pressed the government to work towards international agreements that will unlock funding to help address the climate “emergency” faced by developing countries.

“Without global transformation and adequate financial resources dedicated to solving the climate change problem, which has reached emergency status, any agreement will be meaningless,” Department of Environment and Natural Resources Secretary Maria Antonia Y. Loyzaga said in a statement issued by the Climate Change Commission (CCC).

Under the United Nations Framework Convention on Climate Change, the CCC has engaged technical experts in a dialogue that hopes to address the needs of developing countries for lowering greenhouse gas emissions and climate-resilient development.

The previous administration has staked out a position that the developed world, which has produced the bulk of greenhouse gas emissions as it industrialized, must provide aid to developing countries facing most of the consequences of climate change.

“Urgent delivery of needs-based climate finance on loss and damage is crucial to transformative climate actions by at-risk developing nations. Gone are the days of empty commitments, now is the time to implement, to deliver action with results,” CCC Vice Chair and Executive Director Robert E.A. Borje said.

Mr. Borje said the dialogue is an “opportunity to advance inclusive climate finance, driven by a process that ensures balanced geographical participation, particularly of developing states in the Asia-Pacific region.”

He said the dialogue also allows participants “to be influenced by the best available science, to rectify past mistakes on not considering uncertainties, costing for externalities, and affording ample space to innovate, so that rehabilitation is not the norm.”

Mr. Borje said President Ferdinand R. Marcos, Jr. has declared climate change a priority and expressed his support for climate-mitigation efforts.

“Under Mr. Marcos’ administration, there is a proposal to increase national budget allocation for climate change-related programs, projects and activities,” Mr. Borje said.

“The Philippines will continue to do its part, while pursuing stronger collaboration with partners and stakeholders toward climate justice,” he added.

Mr. Borje called for pragmatic solutions, noting that the Philippines is expected to be one of the countries bearing the brunt of the climate crisis.

The Philippines is considered the fourth most vulnerable country to climate change, according to the Global Climate Risk Index.

“This is what we mean by build right at first sight: to build justly and efficiently at first sight, with a long-term horizon in mind. Our discussions will go beyond dollars and cents,” Mr. Borje said.

“There will be recommendations for actions that will affect the lives and livelihood of nations. Today is an opportunity to get things right. To secure climate equity and justice for all,” he added.

The Ad Hoc Work Programme on New Collective Quantified Goal on Climate Finance created under the Paris Agreement is tasked to conduct four technical exchange dialogues annually until 2024. — Luisa Maria Jacinta C. Jocson

Hybrid work schemes raise work quality, study finds

September 12, 2022 | 8:25 pm

A MAJORITY of employees in the Philippines perceive the quality of their work to have improved under hybrid arrangements, according to a study conducted by technology company Cisco Systems, Inc.

In a statement on Monday, Cisco said 79% of Filipino respondents reported an improvement in work quality, while 89% reported that the flexible work arrangements improved their sense of well-being.

Some 92% reported they were pleased to have access to a hybrid work set-up, while 29% said their companies are prepared to transition to hybrid work.

“Employees and employers in the Philippines are experiencing tangible benefits from hybrid work, stemming across improved employee well-being to better productivity and work performance,” Zaza Nicart, managing director of Cisco Philippines, said.

Hybrid work implies a level of investment in critical technology, with about 73% of respondents considering connectivity issues to be “career limiting.”

“Having a strong networking infrastructure and cybersecurity posture can solve such connectivity issues, and overall deliver seamless and secure work experience for employees,” Ms. Nicart said.

Some 71% of respondents said they expect fully remote workers to face challenges in communicating or engaging with colleagues, compared to those who work on-site. Seventy-one percent of employees also reported that micromanaging increased with hybrid work. — Ashley Erika O. Jose

LGU borrowing applications decline in first eight months

September 12, 2022 | 8:25 pm

NEW DEBT sought by local government units (LGUs) declined by 72.53% year on year to P21.04 billion in the eight months to August, the Bureau of Local Government Finance (BLGF) reported.

The proxy indicator for LGU indebtedness is the issuance by the BLGF of 116 certificates of net debt service ceiling and borrowing capacity to LGUs, which included seven amendments, against 294 issued a year earlier.

These certificates were issued to 83 municipalities, 23 cities, four provinces, and six barangays.

Cities applied to borrow P8.16 billion, followed by municipalities (P8.02 billion), provinces (P4.83 billion), and barangays (P24.65 million).

The certifications are a leading indicator for the borrowing intentions of local governments, whose capacity for taking on debt must be certified by the BLGF, an arm of the Department of Finance.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort attributed the decline to the Supreme Court’s Mandanas ruling and the tight fiscal space.

“More funding allocated to LGUs would fundamentally reduce their borrowing requirements. Furthermore, this may also have to do with the need to reduce the government’s expenditures through more disciplined spending after the huge debt of P5 trillion incurred since the pandemic,” he said in a Viber message.

The Supreme Court ruled that LGUs are entitled to 40% of all national taxes, including those not collected by the Bureau of Internal Revenue, effectively increasing the tax take that subnational entities are entitled to.

The ruling raised the LGU allocation to P959 billion this year, up 37.89%.

In the eight months to August, LGUs’ total borrowing capacity was P49.44 billion, down 75.13% from a year earlier.

Cities had a borrowing capacity of P26.15 billion, followed by municipalities (P17.2 billion), provinces (P6.05 billion), and barangays (P37.24 million).

In August, the BLGF released three certifications to LGUs, including one amendment, covering proposed loans worth P235 million, against P4.02 billion from a year earlier.

Bangar, La Union was the leading availer of loans in August with P200 million. The Cordillera Administrative Region availed of P35 million, while the request of barangay Turod in Sudipen, La Union is undergoing amendment.

The government registered a debt-to-gross domestic product (GDP) ratio of 62.1% as of the second quarter, above the 60% debt-to-GDP ratio considered manageable by multilateral lenders for developing economies. The ratio eased from 63.5% at the end of the first quarter.

The government estimates the debt-to-GDP ratio to drop to 61.8% at the end of the year. — Diego Gabriel C. Robles

UnionBank, GLS sign on as gov’t partners in AI research center

September 12, 2022 | 8:24 pm

THE Department of Trade and Industry (DTI) said it has signed a partnership agreement with UnionBank of the Philippines and Global Learning Solutions (GLS) to establish a research center for artificial intelligence (AI).

In a statement on Monday, the DTI said it signed a memorandum of understanding (MoU) with GLS and UnionBank on Sept. 9, outlining the three partners’ intent to establish and operate the Center for Artificial Intelligence Research (CAIR) and Industry 4.0 Pilot Factory (I4PF).

“With the support of private sector partners, the CAIR will serve as a hub where data scientists and researchers can perform collaborative AI research and development. Complementary to the CAIR, the I4PF will host pilot, demonstration, and learning laboratories for relevant technologies. These include robotics, intelligent manufacturing, and cyber-physical systems,” the DTI said.

“The facilities will also support the development of the digital economy and the creation of new activities in trade, agriculture, manufacturing, and services and encourage entrepreneurship through the adoption of advanced digital technologies in these sectors,” it added.

According to the MoU, the DTI will manage the collaboration, while UnionBank will provide assistance in establishing and operating the CAIR and I4PF. The bank will also house the two facilities in its UnionBank Innovation Campus in San Pedro, Laguna for free.

The GLS will serve as the training and learning partner for upskilling and reskilling activities of small and medium enterprises.

“DTI recognizes the need to embrace Industry 4.0 technologies and will continue to pursue digital transformation to enhance productivity and competitiveness, develop new industries, create more and better jobs, and attract new investments,” Trade Secretary Alfredo E. Pascual said. — Revin Mikhael D. Ochave

Manufacturing jobs seen key to PHL recovery

September 12, 2022 | 8:24 pm

electronics-Factory-workers-reuters — REUTERS

INCREASED manufacturing investment is considered a key condition for bringing about a recovery because of the volume of jobs the sector can potentially generate, the Philippine Chamber of Commerce and Industry (PCCI) said on Monday.

“I think it’s important for us to pursue manufacturing, where you can generate more employment. At the same time, the agriculture sector must be looked into. More often than that, we try to encourage more people to invest in our country in the sector of manufacturing, knowledge space, or services,” PCCI President George T. Barcelon said on the BusinessWorld Live program on One News channel.

Mr. Barcelon said agriculture investment is also needed to wean the Philippines from its dependence on imported food.

“We have to craft our laws to allow foreign companies to come in and also invest in agriculture. On the agriculture side, imports to meet our food requirement are high. We are realistic (about not being able to) produce enough. Now, if companies can come in and help us through investment (in) proper irrigation, proper information systems, that would really be beneficial to all,” Mr. Barcelon said.

“We have the market here. We are 110 million in population. Demand is high,” he added. — Revin Mikhael D. Ochave

Removal of the 5-year validity period for receipts and invoices

September 12, 2022 | 8:24 pm

The Philippine tax system is mostly driven by supporting documents. The deductibility of allowable expenses and claiming of input value-added tax (VAT) rely heavily on valid official receipts and sales invoices. Hence, it is paramount for every business to ensure that the documents they issue are free from error.

For a receipt/invoice to be valid, the taxpayer should first secure an Authority to Print (ATP) or Permit to Use (PTU) a computerized accounting system (CAS), cash register machines (CRM), point-of-sale (POS) machines, and other sales receipting software from the Bureau of Internal Revenue (BIR). Based on previous revenue issuances, official receipts and invoices have a five-year validity from date of ATP or PTU.

Revenue Regulations (RR) No. 18-2012 provides that a taxpayer with expiring ATP for its receipts/invoices must apply for a new ATP not later than 60 days prior to the expiry date. The use of receipts and invoices beyond the five-year validity renders the receipts/invoices invalid; hence, the issuing party is imposed a penalty and the expense of the party claiming such deduction is disallowed. However, not all taxpayers know this and are issuing receipts/invoices even beyond their validity, making it one of the most common issues faced by taxpayers.

Fortunately, the BIR revisited its policies and removed the five-year validity period for receipts and invoices, which is also in line with Republic Act (RA) No. 11032 otherwise known as the Ease of Doing Business and Efficient Government Service Delivery Act of 2018. This new revenue issuance relieves taxpayers of the burden of continuously incurring costs of reproducing their receipts/invoices every five years. This move also promotes sustainability as it reduces paper consumption caused by destruction of expired invoices and receipts and repeated reprinting.

PERPETUAL VALIDITY OF RECEIPTS AND INVOICES
The removal of the five-year validity of receipts and invoices took effect on July 16, which is 15 days from the date of publication of RR No. 6-2022 on July 1.

As a result, all taxpayers with unused manual principal and supplementary receipts/invoices with ATP may continue to use such until fully exhausted. The phrases “THIS INVOICE/RECEIPT SHALL BE VALID FOR FIVE (5) YEARS FROM THE DATE OF THE ATP” and “VALID UNTIL (MM/DD/YYYY),” printed at the bottom of the receipt/invoices shall be disregarded. Subsequent production of manual receipts/invoices will no longer require a validity date printed on the bottom portion.

Taxpayers with PTU or Acknowledgment Certificate (AC), as applicable to CRMs, POS machines, and CAS, may continue to use the previously approved receipts/invoices. Like manual receipts/invoices, the five-year validity may also be disregarded. In addition, the system/software generating receipts/invoices from CAS, component of CAS and CRMs and POS machines must be reconfigured to omit the phrases on validity period.

Unlike manual receipts/invoices, computer-generated receipts/invoices are not “exhausted” because these are not printed or bound by booklets. Hence, all PTUs become perpetually valid unless revoked by the BIR based on the following grounds:

• Tampering of sales data/integrity of the data and/or software specification/features to alter/avoid the recording of sale transaction;

• Any major repair, upgrade, integration, and modification/alteration without prior notification and approval by the BIR office concerned, including the items enumerated in Section V, Item No. 8 of Revenue Memorandum Order (RMO) No. 9-2021, to wit:

– Change in the functionalities of the system, particularly enhancements that will have a direct effect on the financial aspect of the system that includes modified computations and other financial-related issues that were considered;

– Addition or removal of modules or submodules within the system that will have a direct impact on the financial aspect of the system;

– Change in the system/software version or release number that will have enhancements on the financial aspect of the system; and

– All other enhancements that will be deemed major system enhancements based on the recommendation of the technical evaluators of the BIR; and

• Any violation(s) on the policies and procedures for registration under RMO No. 10-2005 and RMO No. 9-2021, and other related revenue issuances.

RECEIPTS/INVOICES PRINTED PRIOR TO RR NO. 6-2022
Since perpetual validity of the receipts/invoices took effect on July 16, all receipts/invoices expiring on or before July 15 are no longer valid. However, worry not because it was clarified that upon the issuance of RR No. 6-2022, taxpayers with ATP expiring on or before July 15 who failed to apply for subsequent ATP not later than the sixty-day mandatory period prior to expiration are not liable to pay the penalty for late application of ATP.

The receipts/invoices which are unused and expiring on or before July 15 must be surrendered together with an inventory to the BIR Revenue District Office (RDO) where the Head Office or Branch is registered on or before the 10^th day after the validity period of the ATP for the destruction of such receipts/invoices.

MODIFICATION OF THE SYSTEM/SOFTWARE GENERATING THE RECEIPTS/INVOICES
Due to the perpetual validity of receipts/invoices which is now in effect, the system/software generating the receipts/invoices for taxpayers employing CRMs, POS machines, and CAS shall be modified to remove the phrase indicating the five-year validity. This modification is considered a minor enhancement because such was mandated upon the effectivity of RR No. 6-2022. Only major modifications require prior written notification before such modifications are made.

Doing business is no easy feat — you must consider, among others, the profitability of your products/services, your target consumers, the way you will market your business, and most especially how you will take care of your clientele. Thanks to the Ease of Doing Business and Efficient Government Service Delivery Act of 2018 and the efforts of government agencies in helping improve business processes, ministerial tasks like renewing your receipts/invoices every five years are now removed. Taxpayers and entrepreneurs can devote more of their energy and resources on their core businesses. Here’s to a big win towards total ease of doing business and promoting environmental sustainability.

Let’s Talk Tax is a weekly newspaper column of P&A Grant Thornton that aims to keep the public informed of various developments in taxation. This article is not intended to be a substitute for competent professional advice.

Runell Alvyn V. Sarmiento is a senior in charge from the Tax Advisory & Compliance division of P&A Grant Thornton, the Philippine member firm of Grant Thornton International Ltd.

pagrantthornton@ph.gt.com

Embiggen launches corporate venture builder focused on strategy execution

September 12, 2022 | 6:35 pm

The Embiggen Group, a Filipino-led innovation consulting agency, recently launched a venture builder to help clients execute their strategies.

“Employees are not comfortable with the process and speed of execution that startups usually have to go through every day. You can outsource that to us, an organization that already has the expertise of scaling a startup or venture from an idea,” said Embiggen co-founder Rolan Marco U. Garcia, at the virtual launch on Sept. 8.

Embiggen, which partnered with the Asian Institute of Management (AIM) and the innovation standard certification body Global Innovation Management Institute (GIMI) in 2021, counts among its clients Telstra Philippines, Aboitiz Equity Ventures, Inc., and Insular Life Assurance Co., Ltd.

“We started as a consulting company, then more and more companies asked help with how they can actually execute, more than just giving them strategies,” said Mr. Garcia.

Embiggen’s ongoing corporate venture building projects include a Philippine insurance company creating a platform for mental health, work-life balance, and financial literacy for millennials and Gen Zs; and a food and manufacturing company that wants to solve logistics problems for Filipino micro, small, and medium enterprises (MSMEs).

“This is a call to action for conglomerates who want to go into innovation because maybe the pandemic gave them an existential crisis that ‘we need to have other options than what we are currently doing,’” said Embiggen co-founder Paul A. Pajo, who also pointed out that the Philippines ranked 51st out of 132 economies in the 2021 Global Innovation Index, dropping one spot from its ranking the year prior.

In its own 2021 study “The Future of Corporate Innovation in the Philippines,” Embiggen highlighted that support and investments from government, incubators, and venture capitalists can further enrich the startup economy.

“Beyond strategy, we’ve seen some conglomerate lines really asking for help with execution,” Mr. Pajo said. — Brontë H. Lacsamana