THE PALACE confirmed Monday that over P18 billion from the second stimulus package, known as Bayanihan II, remains unused, following calls by senators to spend the hundreds of billions of pesos allotted for the pandemic response measure before it expires this month.
“Mayroon pa tayong P18.4 billion or 13% na hindi pa nao-obligate (We have P18.4 billion or 13% which has yet to be obligated),” the President’s spokesman Herminio L. Roque, Jr. said at a televised news briefing Monday.
Legislators have urged the executive branch to spend the remainder of Bayanihan II, authorized by Republic Act No. 11519 or the Bayanihan to Recover as One Act, which expires on June 30.
Budget Secretary Wendel A. Avisado said “agencies can utilize” the unobligated funds “at the end of the month.” He said about P123 billion has been obligated under Bayanihan II.
“Overall, including releases charged against the Fiscal Year 2020 General Appropriations Act, about P200.12 billion has been released for Bayanihan II. Obligations amounted to P172.28 billion (86.09%) and disbursements at P135.81 billion (78.83%),” he told reporters in a Viber message.
Mr. Roque said the executive branch will respect the wishes of Congress should it decide to extend the validity of Bayanihan II.
“We respect the wisdom of Congress dahil sila naman po talaga nagbibigay ng polisiya (because they determine spending legislation),” he said.
Mr. Roque said he has yet to receive any information on whether President Rodrigo R. Duterte will call for a special session to extend the law’s validity. — Kyle Aristophere T. Atienza
MANILA WATER Co., Inc. said it obtained consent from indigenous people to build and operate the Wawa-Calawis Water Treatment plant on ancestral land in Antipolo.
The company signed a memorandum of agreement with the National Commission on Indigenous Peoples (NCIP) and Katutubong Pamayanan ng mga Dumagat/Remontado as part of the “Free, Prior, and Informed Consent” process to build the plant in the ancestral domain of the Antipolo Dumagat-Remontado.
The free, prior, and informed consent process in international human rights protects indigenous participation in decision-making for projects that affect them.
The partnership is the company’s first agreement with construct and operate provisions done with the NCIP, Manila Water said in a statement Monday.
“These provisions will open job opportunities for the IP community during the construction of the facilities in the area and even during operation of the plant,” the company said.
Through the deal, the east zone water concessionaire will build the first phase of the Calawis treatment plant and the second phase of the Wawa treatment plant.
The project will address water demand in Antipolo and Teresa in Rizal province.
Razon-controlled Prime Infrastructure Holdings Corp. recently strengthened its presence in the water market after its Trident Water Co. Holdings, Inc. acquired a controlling stake in Manila Water.
Trident Water now has 51% voting interest in Manila Water while its economic stake is at 25%. Ayala Corp.’s direct and indirect economic interest in the water concessionaire is at 38.6%, while its voting interest is at 31.6%.
Manila Water provides water and wastewater services in eastern Metro Manila, which includes Marikina, Pasig, Taguig, Makati, San Juan, Mandaluyong, parts of Quezon City and Manila, and Rizal province. — Jenina P. Ibañez
COMMUTER TRAIN operator Light Rail Transit Authority (LRTA) announced Monday the postponement of the opening of the Light Rail Transit Line 2 (LRT-2) East Extension Project from June 22 to next month.
“We regret to inform the riding public that the long-awaited opening of the… LRT-2 East Extension Project was postponed for at least two weeks to give maximum time for the contractor to complete the signaling migration and integration works, and other preparatory activities,” LRTA Administrator Reynaldo I. Berroya said in a statement.
The East Extension Project adds four kilometers to the 13.8-kilometer LRT-2 train line, connecting it to Antipolo City.
With the inauguration ceremony now set for July 5, the Marikina and Antipolo stations are due to open to passengers the following day.
The LRTA said the pandemic restricted the arrival of foreign technical experts in signaling systems and some critical equipment necessary to conduct the integration activity and monitor the compliance of the project with Railway Safety International Standards.
“The signaling system is vital in railway operations to ensure safe and smooth train and traffic movement, controlled speed, accurate platform position, safe distance between trains, automatic stop in cases of technical breakdown and is designed in accordance with railway fail-safe principles,” it said.
The extension project aims to reduce the travel time between Manila and Antipolo from three hours to 40 minutes.
It is expected to add 80,000 passengers to the current 240,000 daily ridership of the LRT-2, which currently connects Recto Avenue in Manila to Santolan station in Marikina.
Mr. Berroya said the LRTA and the Department of Transportation (DoTr) had agreed that safety should be issued first before starting operations.
“We at LRTA and DoTr are always committed to provide our passengers with a safe, reliable, and comfortable journey,” he added.
He also appealed for “understanding and cooperation” as the integration of the signaling system of the two new stations to the current system “will require a shutdown of… operations from Santolan to Recto for two consecutive weekends from June 26 to 27 and from July 3 to 4 for the smooth implementation of the activity.”
“For the meantime, LRT-2 full operations from Santolan to Recto and vice versa will resume on Wednesday, 23 June 2021 after the need to implement degraded operations from June 12 to 22,” the LRTA said. — Arjay L. Balinbin
THE Department of Public Works and Highways (DWPH) said Monday the China-funded Estrella-Pantaleon Bridge project, which connects the cities of Makati and Mandaluyong, is now 93% complete.
“Only a few activities” are left before the new bridge opens next month, Public Works and Highways Secretary Mark A. Villar said in a statement.
“Concreting of approach road on both sides of Makati and Mandaluyong will complete the links with the finished main and approach bridge,” Undersecretary for Unified Project Management Office Operations Emil K. Sadain said.
The P1.46-billion bridge project “will have four lanes and will be a 506.46-meter pre-stressed concrete rigid frame bridge with corrugated steel webs, replacing the temporary two-lane box truss bridge made of modular steel components dismantled in 2019,” the department noted.
The bridge project is one of two grant bridges — the other one is Bonifacio Global City’s Lawton-Sta. Monica Bridge — from China being implemented by the department.
“Other remaining ancillary works to complete the stunning bridge project with V-shape piers include asphalt overlay; and installation of lane markings, protective barriers and railings along both sides of the bridge, pipes for the storm water drainage structure, and lighting,” it added.
The project is among the 14 agreements signed during Chinese Premier Li Keqiang’s state visit to Manila in November 2017.
Once completed, the new bridge is expected to accommodate about 50,000 vehicles daily. — Arjay L. Balinbin
LANDLORDS have a duty to comply with the energy efficiency law by monitoring monthly consumption and setting annual reduction targets, Leechiu Property Consultants (LPC) said.
LPC Executive Director Lylah Ledonio said landlords stand to gain from cost savings by pursuing energy efficiency measures.
“This law encourages landlords to refresh their mindset and improve their power usage,” she said in a statement issued by LPC.
Republic Act No. 11285 or the Energy Efficiency and Conservation Act also requires building owners to use renewable energy such as solar power for at least 1% of total projected annual energy consumption, a rule that was clarified by Energy department guidelines that took effect in March.
The Energy department conducts audits on building energy reduction every three years.
Alexander Ablaza, president of the Philippine Energy Efficiency Alliance, said at a forum organized by the European Chamber of Commerce of the Philippines that improvements in building energy use can translate to increased rental rates, lower tenant turnover, and higher property value.
LPC noted landlords’ reluctance to use energy-efficient measures due to the cost of investing in new technology. But Mr. Ablaza said that landlords can also work with service companies that help guarantee energy savings.
Meanwhile, Ricardo Cuerva, managing director of the Nova Group, said at the forum that energy efficiency is a first step in addressing climate change, noting that buildings contribute to carbon emissions due to the steel and cement used in construction.
“As an industry, we need to focus on rapid innovation in the manufacturing of these key components to greatly reduce emissions,” he said. — Jenina P. Ibañez
More than a year after the onset of the Coronavirus Disease 2019 (COVID-19) pandemic, the government continues to ramp up its efforts to reduce financial distress brought by the public health crisis. As part of its response, the Bureau of Internal Revenue (BIR) issued Revenue Regulations (RR) No. 8-2021 on June 12. RR 8-2021 seeks to amend RR 4-2021 which was initially issued to implement Value-Added Tax (VAT) and Percentage Taxes under Republic Act (RA) 11534 or the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act.
The three salient features of the regulation are: (1) the reversion of the VAT-exempt threshold on the sale of dwellings back to P3,199,200; (2) the exemption of imports of certain goods needed to contain COVID-19 from the Authority to Release Imported Goods (ATRIG) requirement; and (3) a tax refund for overpayment of percentage tax.
VAT-EXEMPT THRESHOLD ON THE SALE OF DWELLINGS RA 10963 or the Tax Reform for Acceleration and Inclusion (TRAIN) Law provides that starting Jan. 1, 2021, the threshold of VAT exemption for transactions involving residential dwellings be decreased from P2.5 million to P2 million. The implementing regulations adjusted the threshold to P3,199,200 based on the 2010 Consumer Price Index Values pursuant to RR 16-2012.
Taxpayers raised worries regarding the legislated decrease because even after it was raised to approximately P3.2 million, some low-income families will find it hard to afford. Concerns were raised that the full 12% VAT will be passed on to buyers seeking decent dwellings; some buyers of affordable homes may be put off from buying due to the VAT.
Hope arose when the CREATE Bill passed in the Senate, which raised the VAT exemption threshold to P4.2 million. The upward adjustment was vetoed by the President, who said the P4.2 million is highly distortive as it will benefit even those not targeted for VAT exemption — those who can afford proper housing. With the President’s veto, the P2 million threshold under the TRAIN Law remained, as implemented by RR 4-2021 in April.
With the issuance of RR 8-2021, the BIR has now reverted the VAT-exempt threshold to P3,199,200. This is good news considering that many of us have made the decision to stop renting and are now starting to invest in houses due to work-from-home setups because of the community quarantine. Filipinos can continue to enjoy the VAT exemption for residential dwellings not exceeding P3,199,200 when buying affordable housing.
The P3,199,200 VAT-exempt threshold, however, should only apply to sale of detached homes and other residential dwellings like condominiums. Sales of residential lots only are not included in the threshold exemption.
IMPORTS NOT SUBJECT TO ATRIG Section 12 of the CREATE Act, which amended Sec. 109 (BB) of the Tax Code, provides the VAT exemption from January 1, 2021 to December 31, 2023 on the sale or importation of the following:
1. Capital equipment, its spare parts and raw materials, necessary to produce personal protective equipment components;
2. All drugs, vaccines and medical devices specifically prescribed and directly used for the treatment of COVID-19; and
3. Drugs, including raw materials, for the treatment of COVID-19 approved by the FDA for use in clinical trials.
RR 8-2021 subsequently added that these goods are not subject to the issuance of an ATRIG and may be released by the Bureau of Customs (BoC) immediately. ATRIG is an authority issued by the BIR, addressed to the Customs Commissioner, to allow the release of imported goods from the ports upon payment of duties and taxes or the presentation of proof of exemption.
The procedure for acquiring the imported COVID-19 products will now be relatively easier because the BIR removed the requirement of obtaining an authority before such items can be released by the BoC. This is in line with the government’s effort to achieve herd immunity following the launch of the vaccination process. Sans the exemption from ATRIG, importers would still have to collate supporting documents and wait for the BIR’s approval. Worthy to note, however, is that post-audit investigations on importers exempt from ATRIG could still be conducted.
TAX REFUND OF PERCENTAGE TAXES Any person whose sales or receipts does not exceed the P3 million VAT threshold and who is not VAT-registered is exempt from paying VAT and is to pay percentage tax on quarterly gross sales or receipts. Under the CREATE Act, the percentage tax rate was decreased from 3% to 1% which is to be in effect between July 1, 2020 and June 30, 2023. Since there is retroactive application of the decreased rate, there are taxpayers who overpaid percentage tax. Under the rules, the default treatment of the overpaid percentage tax is applied to the next taxable quarters.
Under RR 8-2021, a tax refund can be availed of by those taxpayers who:
1. Shifted from Non-VAT to VAT-registered status; and
2. Have opted to avail of the 8% income tax rate at the beginning of TY 2021.
The CREATE Law was enacted to drive the economy towards global competitiveness. It further seeks to improve the tax system by lowering the tax rate, widening the tax base, and reducing tax distortions. Through the CREATE Act, the government also aims to provide support to businesses in their recovery from the COVID-19 outbreak. RR 4-2021 was issued to implement the VAT and Percentage Tax under the CREATE Law. Meanwhile, RR 8-2021 appears to be the BIR’s response to the economic effects of COVID-19, specifically by acknowledging that the demand for housing is not dampened by the pandemic, by easing procedures in releasing imported goods to fight the virus, and by providing rules to recover overpaid percentage taxes. After more than a year of dealing with the coronavirus and with the ongoing drive to inoculate the population, we cannot wait for the economy to fully recover and be stable soon.
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.
Azanith Ann B. Payad is an associate of the Tax Advisory & Compliance division of P&A Grant Thornton, the Philippine member firm of Grant Thornton International Ltd.
RESIDENTS of Deparo in Caloocan line up for registration for their first dose of Sinovac vaccine at the Deparo Elementary school, June 21, 2021. — PHILIPPINESTAR/ MICHAEL VARCAS
By Kyle Aristophere T. Atienza, Reporter
FOUR more Filipinos have been infected with the Indian variant of the coronavirus that has triggered a fresh surge in cases there, bringing the total to 17, Health authorities said on Monday.
Of the four, three were returning Filipino seafarers from a crew ship docked in South Korea, the Department of Health (DoH) said in a statement.
They were sent home on June 3 after testing positive for the more contagious variant of the virus, it added.
Two of the patients had completed their 10-day quarantine and were discharged, while one was still in the hospital, it said.
The fourth one is a returning migrant worker who arrived in Manila on May 24 and who had since recovered.
“The Delta variant is spreading rapidly worldwide,” Cynthia P. Saloma, executive director of the University of the Philippines-Philippine Genome Center told a televised news briefing. “We can see it now in 80 countries,” she added, citing the World Health Organization.
There has been no community transmission of the Indian variant of the virus.
“So far, the Delta variant was only seen at ports of entry so there is no community transmission,” she said in mixed English and Filipino.
Manila should strictly enforce border controls to prevent the variant from spreading in communities, Ms. Saloma said.
The Delta variant is 60% more infectious, she said, noting that an infected person can transmit the virus to as many as eight people.
The Health department said 14 more people have been infected with the Alpha variant of the coronavirus, which was first detected in the United Kingdom, bringing the total to 1,085.
Of the total, 12 were locals, while two were still being verified, DoH said. Two people have died from the British variant of the virus, while 12 have recovered, it said.
DoH also reported 21 new cases of the Beta variant that was first detected in South Africa, bringing the total to 1,267. Of these, 20 were locals, while one was still being verified.
Twenty people have recovered, while one was still an active case, it added.
One new case of the Theta variant was also reported, DoH said. It is still verifying whether the person infected with the virus first detected in the United States is a local or a returning migrant worker.
The Theta variant is not a “variant of concern” since DoH needs more data to conclude whether it will have significant public health implications, it said.
DoH reported 5,249 coronavirus infections on Monday, bringing the total to 1.36 million.
The death toll rose by 128 to 23,749, while recoveries increased by 7,053 to 1.28 million, it said in a bulletin.
There were 55,847 active cases, 1.3% of which were critical, 91.4% were mild, 4.1% did not show symptoms, 1.9% were severe and 1.32% were moderate.
The agency said 23 duplicates had been removed from the tally, 16 of which were tagged as recoveries.
DoH said 62 cases tagged as recoveries had reclassified as active cases and 45 cases that were previously tagged as recoveries were reclassified as deaths. Eight laboratories failed to submit data on June 19.
Meanwhile, about 8.4 million doses of coronavirus vaccines have been given out as of June 20. Of the total, more than 6.2 million were first doses, according to government data.
Meanwhile, presidential spokesman Herminio L. Roque, Jr. said people no longer need to wear face shields outdoors. It is only required in crowded and enclosed places, he told a televised news briefing.
He earlier said President Rodrigo R. Duterte thought face shields should only be worn in hospitals.
VETERAN legislators will run for senator under the Nationalist People’s Coalition (NPC) next year, according to the Senate president.
NPC members and former Senators Loren Regina B. Legarda, Francis Joseph G. Escudero and Joseph Victor G. Ejercito would likely run for the post, Senate President and party Chairman Vicente C. Sotto III told reporters at a virtual news briefing on Monday.
Senators Sherwin T. Gatchalian, Juan Miguel F. Zubiri and Richard J. Gordon may also run for reelection under the party, he said.
Former senator and Information and Communications Technology Secretary Gregorio “Gringo” B. Honasan II is also eyeing a Senate comeback, which he would support, Mr. Sotto said.
He also said he would campaign for Senator Panfilo N. Lacson as the party’s presidential bet.
President Rodrigo R. Duterte’s six-year term ends next year. He is barred by law from running for reelection.
Mr. Sotto said the party might nominate a candidate for the presidential race, adding that he would welcome Mr. Lacson, an independent candidate, to the party.
“That is a possibility, but I cannot speak for my entire party at this point when it comes to a presidential candidate,” he said. “I can get the support of the majority of them, but I cannot dictate on my party mates.”
Mr. Sotto earlier said he would run for vice president if Mr. Lacson eyes the presidency.
He said their electoral agenda might include peace and order issues including the country’s illegal drug problem. It may also tackle the effects of the coronavirus pandemic on the economy.
Former Ilocos Sur Governor and Narvacan Mayor Luis Chavit Singson on Saturday joined the NPC, which business tycoon Eduardo Cojuangco, Jr. founded in 1992.
Mr. Sotto said Mr. Singson contributes a lot to the party, citing his charisma and influence on local chief executives in the country.
Mr. Singson is the president of the League of Municipalities in the Philippines.
The ruling Partido Demokratiko Pilipino–Lakas ng Bayan (PDP-Laban) earlier passed a resolution urging its chairman, President Rodrigo R. Duterte, to run for vice president next year.
Constitutional experts have said a potential Duterte vice presidency would circumvent a constitutional provision that says a sitting president “shall not be eligible for any reelection.”
Davao City Mayor Sara Duterte-Carpio was among those being considered by Mr. Duterte to become the ruling party’s standard bearer in the 2022 elections, presidential spokesman Herminio L. Roque earlier said.
Mr. Duterte’s daughter remained undecided about running, he added. The President earlier said his daughter would not follow in his footsteps.
Also included on the list of Mr. Duterte’s presidential bets were former Senator Ferdinand R. Marcos, Jr., Manila Mayor Francisco M. Domagoso, Senators Christopher Lawrence T. Go and boxing champion Senator Emmanuel “Manny” D. Pacquiao, Mr. Roque said. — Kyle Aristophere T. Atienza
PRESIDENT Rodrigo R. Duterte has declared June 24 a special nonworking holiday in Manila to mark the capital’s 450th anniversary.
The holiday would give residents of the Philippine capital the “full opportunity to celebrate and participate in the occasion with appropriate ceremonies,” according to a proclamation signed by Executive Secretary Salvador Medialdea last week.
The celebration would still be subject to community quarantine, social distancing and other public health measures amid a coronavirus.
Manila is one of the 17 cities and municipality in the capital region, which accounts for a third of the country’s economic output. — Kyle Aristophere T. Atienza
THE PHILIPPINES and Saudi Arabia will “work more closely together in bilateral and multilateral fora” to advance their labor reform and fair migration efforts, the Presidential Communications Operations Office (PCOO) said.
The two countries made the commitment during a meeting Sunday between Philippine Presidential Assistant on Foreign Affairs Robert E. A. Borje and Saudi Ministry of Human Resources and Social Development Minister Ahmad Sulaiman Al Rajhi, the PCOO said in a press release.
During the meeting, Mr. Borje noted that President Rodrigo R. Duterte welcomed Saudi Arabia’s launching of the Labor Reform Initiative (LRI), saying it is a significant step towards addressing issues regarding the existing sponsorship system in the middle east country.
Mr. Borje also sought the Saudi minister’s support for other initiatives of Manila, including the ongoing repatriation program for Filipino workers whose employment had been affected by the coronavirus pandemic as well as efforts to further strengthen the Philippine’s diplomatic offices in the Kingdom.
There were about 2.2 million Filipinos working in Saudi Arabia as of 2019, based on Philippine Statistics Authority data.
The two officials will be working on a bilateral memorandum of understanding (MOU) on labor, which would be based on Saudi’s LRI.
“Both officials hope to see the convening of a technical working group on the details of the MOU on labor,” the PCOO said. — Kyle Aristophere T. Atienza
SENIOR high school (SHS) graduates got a chance to learn more about creating a “professional brand” for themselves and developing resumes online that are more likely to attract employers through a program of the Department of Education (DepEd) with the Employers Confederation of the Philippines (ECOP) and Microsoft.
The virtual event was attended by more than 260,000 learners and teachers, according to Microsoft in a press release on Monday.
“By providing our SHS learners access to LinkedIn and skilling platforms such as Microsoft Learn, Microsoft Imagine Academy, and LinkedIn Learning, students will be given the opportunity to not just connect professionally with industry practitioners but also acquire competencies and digital certifications,” DepEd Undersecretary Alain Del B. Pascua said in the release.
SHS is the last two years of the Philippine’s K to 12 education system. In this level, students have choices for specialization or career tracks that prepare them for either immediate employment after graduation, entrepreneurship, or tertiary education.
Citing a 2020 research from the Philippines Institute of Development Studies, Microsoft said 80% of SHS graduates in the Philippines pursue further studieswhile 20% enter the labor force immediately.
DepEd, through the program with ECOP and Microsoft, is introducing new initiatives to complement the K to 12 basic education program to prepare students with the necessary skills for the modern workplace and address the workforce and employer gaps.
Microsoft said it will work closely with DepEd for the full extension of the program to Grade 10 and 11 students, with a target of five million learners a year. — MSJ
FIVE towns and one city in Batangas have been declared free from African Swine Fever (ASF), the first local declaration of ASF-free areas in the country, the International Training Center on Pig Husbandry said on Monday.
In a statement, the center said the six ASF-free zones are the municipalities of Rosario, Malvar, Taysan, San Jose, and Nasugbu, and Lipa City.
The Batangas provincial government made the declarations based on their surveillance, as supported by the Department of Agriculture’s regional office, Agriculture Spokesman Noel O. Reyes said in a mobile message.
The Bureau of Animal Industry (BAI) will validate the declarations.
The BAI on June 8 noted a decline in the number of barangays or villages where cases of ASF are still detectable to 19, after more than 2,700 barangays were affected since Aug. 2019.
Pork prices have soared as supply dropped due to the ASF outbreak that has affected many parts in the northern island of Luzon. Several areas in the Visayas in central Philippines and Mindanao in the south were also affected.
“Challenges in the availability of test kits, facilities, laboratories were encountered. Adding on the pressure was the movement of man due to the pandemic, slowing down the surveillance activities, investigations, and repopulation,” the center said. — Jenina P. Ibañez
