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HMO industry 2020 profits surge as patients defer procedures

PHILSTAR

THE health maintenance organization (HMO) industry’s profits surged 465% to P7.12 billion in 2020, with patient deferment of medical procedures outweighing the added expense of treating coronavirus victims, the Insurance Commission said.

Insurance Commissioner Dennis B. Funa said Monday that based on the industry’s unaudited financial statements, expenses of 25 out of 29 HMOs that have submitted their accounts dropped 10.2%, while revenue rose 1.4% to P52.29 billion.

“It should be pointed out, though, that the HMOs have shouldered a significant amount of the COVID-19 private medical expenses,” Mr. Funa said.

“The figures we are seeing now reflect the temporary changes in the behavior of the general public. It appears that people are deferring or postponing, if they can, medical procedures. But definitely this is just temporary. When the opportunity affords, people will have their medical check-ups and procedures,” he added.

He said seven HMOs experienced declining profits of between 23% and 730%. He did not identify the companies.

The industry’s assets grew 37.53% to P59.25 billion in 2020, while liabilities grew 28% to P45.53 billion.

“It will be noted that 33.13% of the total liabilities were unearned membership fees, which refer to fees paid in advance to the HMO industry for services not yet provided,” the regulator said.

Equity in HMOs totaled P13.72 billion in 2020, up 82.7%, following a 59% rise in retained earnings.

Mr. Funa said the financial results reflect growing awareness of HMO products and their value.

“Perhaps now during this COVID-19 pandemic, more than ever, the importance of HMO products has been highlighted… The increase in the HMO industry’s total revenue is mainly driven by its continuously growing total membership, or enrollees’ fees, which comprise 97.12% of the industry’s total revenue,” he added.

The HMO segment outperformed the insurance industry overall, with life insurers, non-life insurance companies and mutual benefit associations reporting a combined net profit of P41.24 billion in 2020, down 8.6%. — Beatrice M. Laforga

Investigation underway after corruption allegations against WiFi contractor

PHILIPPINE STAR/ MICHAEL VARCAS

THE Department of Information and Communications Technology (DICT) said Monday that it is set to investigate corruption allegations against SpeedCast International Ltd, a Hong Kong-based firm tapped to implement the government’s free internet connectivity project.

The announcement, in a statement issued late Monday, comes after the President’s spokesman Herminio L. Roque, Jr. asked the DICT to terminate its contract with SpeedCast for the P1.3-billion free WiFi project due to the slow rollout, and amid reports that the company had undervalued six shipments in its Customs declarations.

“We constituted an Investigating Task Force, and it is set to investigate the Bureau of Customs (BoC) findings on the UNDP contractor’s alleged violation of customs and other Philippine laws,” it said in a statement, referring to the United Nations Development Programme, the proponent of a global inclusive connectivity initiative.

“We will review the BoC report and the evidence presented, and call the necessary parties to our investigation.”

In a televised briefing, Mr.  Roque said it was unacceptable that only 10,000 out of the 120,000 target sites have been provided free wireless internet access nearly four years after President Rodrigo R. Duterte signed Republic Act No. 10929, which authorized the government to offer the public free internet access.

The law led to a DICT to partnership with the UNDP in 2018 to install free internet in selected public areas. 

“Based on existing records, the UNDP Pipol Konek Project was entered into in September 2018 during the early stages of the Department when the DICT still did not have the capacity to procure and implement the project on its own,” the DICT said. “As a result, UNDP entered into the picture to help implement the project and the DICT took no part in the bidding and selection process of UNDP’s suppliers, including SpeedCast.”

The DICT said itasked the UNDP to return the funds “so that DICT can fast track and continue” the project.  

The DICT said it is now capable of implementing the project without involving its current partners, noting that it was able to activate more than 4,000 sites on its own. 

“Under our leadership, we are more than capable of finishing the project,” it said. — Kyle Aristophere T. Atienza

Wholesale price growth picks up in February

REUTERS

WHOLESALE PRICE growth in general goods picked up on a year-on-year basis in February, according to the Philippine Statistics Authority.

The general wholesale price index (GWPI) rose 2.4% from a year earlier in February, up from the growth rate of 2.1% in January. The corresponding growth rate in February 2020 was 2.7%.

The GWPI’s performance in February was driven by mineral fuels, lubricants and related materials (13.6% growth in February, against minus 3.6% in January); chemicals including animal and vegetable oils and fats (5% from 4.1%); miscellaneous manufactured articles (0.7% from 0.1%); and manufactured goods classified chiefly by materials (0.5% from 0.3%).

Price growth slowed in crude materials, inedible except fuels (36.9% from 42.4%); beverages and tobacco (6% from 6.4%); and food (2.2% from 2.7%).

Price growth in machinery transport and equipment remained unchanged at 0.5%.

The growth of wholesale prices varied by major island group. In February, the GWPI in Luzon and Mindanao accelerated to 2.8% and 4.5%, respectively, from 2.3% and 2.8%. On the other hand, the GWPI in the Visayas posted a 1.2% decline, unchanged from January.

In the two months to February, the GWPI grew 2.3%, averaging 2.6% in Luzon and 3.7% in Mindanao, and minus 1.2% in the Visayas.

“The GWPI likely tracked the pickup in CPI (consumer price index) inflation with commodity prices on the uptrend in the first quarter of the year,” ING Bank NV Manila Senior Economist Nicholas Antonio T. Mapa said in an e-mail, adding rising fuel costs linked to the year-on-year increase in crude oil “will likely have pushed up costs.”

The economist expects the increase in wholesale prices to continue “at least in the near term.”

Consumer price inflation was 4.5% in March, exceeding the central bank’s 2-4% target band for 2021 and its forecast of 4.2%. — Lourdes O. Pilar

Top Philippine envoy tells China to get out of sea, files 2 protests

PHILSTAR

THE PHILIPPINES’ top envoy minced no words in telling the Chinese to get out of its waters in the South China Sea, cussing at its neighbor for failing to reciprocate its goodwill.

“China, my friend, how politely can I put it?” Foreign Affairs Secretary Teodoro M. Locsin, Jr. tweeted on Monday. “What are you doing to our friendship?”

“We’re trying. You. You’re like an ugly oaf forcing your attention on a handsome guy who wants to be a friend; not to father a Chinese province,” he added.

He made the remarks as the Department of Foreign Affairs (DFA) filed two more diplomatic protests against China for its “belligerent actions.” It cited the “incessant, illegal, prolonged, and increasing presence” of Chinese fishing and militia vessels in the area.

“China has no law enforcement rights in these areas,” the agency said. The presence of Chinese Coast Guard vessels near Thitu Island and Scarborough Shoal “raises serious concerns.”

“The unauthorized and lingering presence of these vessels is a blatant infringement of Philippine sovereignty,” it added.

Five Chinese Coast Guard vessels remained in the country’s territorial waters as of April 22, a Philippine task force said earlier.

The Foreign Affairs department rejected the Chinese Embassy’s earlier statement that China has sovereignty over Scarborough Shoal.

“It is without basis in international law, including the 1982 United Nations Convention on the Law of the Sea, and is not recognized by the international community,” it said.

The Philippines said the Spratlys and Scarborough Shoal are parts of Philippine territory and its sea patrols and training exercises there were legitimate. “China has no law enforcement rights in these areas.”

The task force last week said at least five Chinese Coast Guard vessels were seen in the South China Sea — three in Scarborough Shoal, one in the municipality of Kalayaan in Palawan province and another in Second Thomas Shoal.

Meanwhile, Senator Risa N. Hontiveros-Baraquel said China should order its coast guard to leave the area.

“The Philippine Coast Guard has the absolute right to conduct maritime patrols and training exercises in the entire West Philippine Sea,” she said in a statement, referring to parts of the China Sea within the country’s exclusive economic zone.

She said the government should not stop filing diplomatic protests and should send more ships to show China “how worthless, illegitimate and unlawful her claims are.”

“This is not the time to kowtow to the autocratic and hypocritical regime in Beijing,” the opposition senator said. “If we don’t assert our rights under international law, we lose them.”

The Philippines has fired off several diplomatic protests against China after authorities spotted a swarm of Chinese vessels, including six war ships within its waters in the South China Sea.

The Philippine task force said more than 200 Chinese ships had been scattered in waters within its exclusive economic zone. About 15 vessels either manned by Chinese militia, the People’s Liberation Army Navy or Chinese Coast Guard had also been spotted at Scarborough Shoal.

Meanwhile, about 240 Chinese vessels that China claims are ordinary fishing vessels have spread out to a wider area in the South China Sea, the agency said. The ships allegedly manned by Chinese maritime forces were scattered across the Spratlys, about 175 nautical miles west of Palawan province, it added. — Vann Marlo M. Villegas

COVID-19 infections at 1.1 million, with 17,525 deaths — DoH

PHILIPPINE STAR/ MICHAEL VARCAS

THE DEPARTMENT of Health (DoH) reported 7,255 coronavirus infections on Monday, bringing the total to more than 1.06 million.

The death toll rose by 94 to 17,525, while recoveries increased by 9,214 to 975,234, it said in a bulletin.

There were 69,466 active cases, 1.1% of which were critical, 94.7% were mild, 1.8% did not show symptoms, 1.4% were severe and 0.94% were moderate.

The agency said 13 duplicates had been removed from the tally, nine of which were tagged as recoveries. Fifty-one recoveries were reclassified as deaths. Fifteen laboratories failed to submit data on May 1.

About 11.2 million Filipinos have been tested for the coronavirus as of May 1, according to DoH’s tracker website.

The coronavirus has sickened about 153.5 million and killed 3.2 million people worldwide, according to the Worldometers website, citing various sources including data from the World Health Organization.

About 130.9 million people have recovered, it said.

Meanwhile, Health Undersecretary Maria Rosario S. Vergeire said the first batch of 15,000 doses of Russia’s Sputnik V coronavirus vaccine would be used at seven vaccination sites in the cities of Makati, Taguig, Parañaque, Manila and Muntinlupa City.

She also said the agency would “act accordingly” on the distribution by lawmakers of the anti-parasitic drug ivermectin last week.

Two congressmen led the distribution of ivermectin in Quezon City. The DoH last week said there was insufficient evidence to recommend the use of ivermectin for coronavirus patients.

Meanwhile, Food and Drug Administration (FDA) chief Rolando Enrique D. Domingo said they were investigating if the manufacturer and distributor of ivermectin for the coronavirus had followed FDA regulations.

“FDA’s concern is the regulation, including manufacturing and dispensing, of the ivermectin drugs,” he told an online forum. “If there were mistakes, then there are equal penalties.”

Mr. Domingo said the treatment of coronavirus disease 2019 (COVID-19) patients should be left to doctors, who should not prescribe drugs that have not been registered locally. People who have taken ivermectin should report problems to the FDA, he added.

Also on Monday, Health Undersecretary Leopoldo J. Vega told a televised news briefing on Monday 367 more intensive care (ICU) unit beds for coronavirus patients had been put up in Metro Manila, bringing the total to 1,148.

Presidential  spokesman Herminio L. Roque, Jr. said he was pushing for 200 more ICU beds in Metro Manila.

“I will confirm on my own that as a result of my own hospitalization experience, I’m pushing for at least 200 additional ICU beds,” he told the same briefing. “That’s part and parcel of foresight. We can never say that what happened in India will not happen here.”

Mr. Roque said 64% of ICU beds in the country had been used as of May 2. About 45% of isolation beds have been used and more than 51% of ward beds were occupied.

About 70% of ICU beds in Metro Manila have been used, while 50% of isolation beds and 62% of ward beds in the region were occupied, he added.

Meanwhile, India’s Bharat Biotech, Inc. would only start delivering its coronavirus vaccines to Manila once the government has completed all regulatory requirements, Philippine Ambassador to India Ramon S. Bagatsing, Jr. said.

“We hope the requirements can be expedited by the regulatory authorities in the Philippines so that it can be brought there,” he told the same briefing. “Once all approvals are all in place, they can send it to the Philippines within one month.”

Mr. Bagatsing said Bharat’s Covaxin had not been approved for emergency use in the Philippines. The Finance department has yet to finalize its pricing scheme for the vaccine, he added.

“If those two hurdles are settled, then the orders can be made and the shipments can follow,” he said.

Mr. Bagatsing earlier said the country would take delivery of about eight million doses of Covaxin by the end of May. — Vann Marlo M. Villegas, Bianca Angelica D. Añago and Kyle Aristophere T. Atienza

March NCR retail price growth fastest in almost two years

RETAIL PRICE growth in Metro Manila grew at the most rapid pace in nearly two years in March, the Philippine Statistics Authority (PSA) reported Sunday.

Retail prices in the National Capital Region (NCR), as seen in the general retail price index (GRPI), rose 1.8% in March, compared with 1.4% in February and 1.1% in March 2020. The latest indicator was also the largest rise in 23 months, or since the 2.7% increase in April 2019.

The PSA attributed the March outcome to the uptrend in the GRPI in mineral fuels, lubricants and related materials, which picked up by 9% that month following successive months of year-on-year declines since March 2020.

The GRPI in chemicals, including animal and vegetable oils and fats, picked up by 0.8% from 0.02% in February. Machinery and transport logged 0.3% growth from 0.05% the previous month.

Slowdowns were noted in the price growth of crude materials, inedible except fuels (2% in March from 2.1% in February) and miscellaneous manufactured articles (0.2% from 0.3%).

Compared with the previous month, growth in retail prices remained unchanged for beverages and tobacco (6.5%); food (2.3%); and manufactured goods classified chiefly by materials (0.9%).

In an e-mail, UnionBank of the Philippines, Inc. Chief Economist Ruben Carlo O. Asuncion pointed to prices of fuel and other oil products, which started to increase at the beginning of this year.

Mr. Asuncion added that for April, retail prices in the NCR “may have taken a slight breather” given that month saw stricter movement restrictions.

“However, the trend may be upward as the economy strives again to reopen, with the government lifting most quarantine restrictions as case infections start to decline,” he said.

The government reimposed the enhanced community quarantine (ECQ) — the strictest lockdown setting — in Metro Manila and nearby provinces between March 29 and April 12. The region has since been placed under a looser “modified” ECQ which is due to be lifted on May 14. — Lourdes O. Pilar

Duterte gets vaccinated vs coronavirus

@BONGGOPAGE

Philippine President Rodrigo R. Duterte got vaccinated against the coronavirus on Monday night, according to a senator who is his long-time friend.

The President, 76, got the shot made by China’s Sinopharm Group Co. Ltd., Senator Christopher Lawrence T. Go said in a Facebook post.

The lawmaker, who was with Mr. Duterte, also posted a video showing Health Secretary Francisco T. Duque III giving the shot.

The President got vaccinated not only to protect himself from the virus but also to encourage Filipinos to get vaccinated, Mr. Go said.

Mr. Duterte, a senior citizen, belongs to a priority group for the coronavirus vaccine.

Sinopharm had not received an emergency use authorization for its vaccine. The local Food and Drug Administration, however, has allowed the compassionate use of 10,000 doses of its vaccine for presidential guards. — Kyle Aristophere T. Atienza

Commission says 3 wage hike petitions pending

THE National Wages and Productivity Commission (NWPC) said there are three active regional wage hike petitions as of Monday.

In a briefing, NWPC Executive Director Maria Criselda R. Sy said the petitions are from Region II (Cagayan Valley), National Capital Region (NCR), and Region XI (Davao Region). All three were filed with their respective Regional Tripartite Wages and Productivity Boards (RTWPBs).

Ms. Sy said the Region II petition filed by the Unyon ng mga Manggagawa sa Agrikultura is for a “P100 emergency wage relief across the board.”

Ms. Sy added the NCR petition was filed in 2019, with the NCR wage board “still continuing its evaluation. The board will make a decision at an appropriate time.” The NCR petition was filed by Unity for Wage Increase.

The Davao Region wage hike petition, Ms. Sy said, involves a P100 increase in the minimum wage for agricultural and non-agricultural workers.

In a mobile message to reporters Monday, Ms. Sy also said the Davao Region wage petition was refiled by the Association of Democratic Labor Organizations-Kilusang Mayo Uno on April 20 after the initial petition was found non-compliant.

Daily minimum wages in the regions are P500 to P537 for the NCR; P345 to P370 in the Cagayan Valley; and P381 to P396 in Davao Region.

Ms. Sy said at the briefing that the wage petition filed by the Federation of Free Workers (FFW) with the RTWPB of Region IV-A (Calabarzon, or Cavite, Laguna, Batangas, Rizal, and Quezon) was not included in the list of active petitions because the wage board decided to defer its decision for the meantime. The FFW petitioned in 2019 for an P50.91 to P70.92 increase in the minimum wage, currently at P303 to P400 in Calabarzon. — Gillian M. Cortez

Ban on imports of auto parts not compliant with Euro 4 deferred

REUTERS

THE RULE banning imported auto parts that are not compliant with Euro 4 emissions standards has once again been deferred, the Department of Trade and Industry (DTI) said.

The rule will not apply during the public health emergency and up to a year after the emergency has been lifted, the DTI said in a statement Monday.

A department order initially set to take effect in 2019 prohibited the entry of truck engines and auto parts that do not meet European emissions standards. But the provision was deferred due to a shortage of skilled technicians and limited Euro 4 training at the time.

Accredited truck rebuilders will continue to be granted certificates allowing them to import parts for assembly that are not compliant with the standard, according to a DTI circular signed in March.

This second deferral was granted “in consideration of the disruptions brought about by the pandemic, and the challenges of implementing a face-to-face training program in light of the strict observance of health protocols throughout the country.”

The extension can be cut short if the department finds that enough personnel have been trained.

European vehicle emission standards are set by the European Union, with Euro 4 directives implemented in 2005.

President Rodrigo R. Duterte in March 2020 declared a public health emergency due to the coronavirus disease 2019 (COVID-19) pandemic. — Jenina P. Ibañez

Taxpayers are in for another bumpy ride

This year has been one of the most challenging filing seasons ever, particularly for accountants. On top of implementing recovery measures to mitigate the impact of the COVID-19 pandemic and addressing employee health concerns, companies also have to deal with demanding tax deadlines. This year, no extension was granted for the filing of Annual lncome Tax Returns (AITR). Also, a new required attachment to the AITR has been introduced. While the BIR allowed taxpayers to file provisional AITRs and amend these on or before May 15 without interest, surcharges, and penalties, beating the April 15 deadline was still a challenge.

Last year, the BIR issued Revenue Regulations (RR) No. 19-2020, as amended by RR No. 34-2020, which requires the submission of BIR Form No. 1709 (Related Party Transactions Form or RPT Form) and the preparation of Transfer Pricing Documentation (TPD) for qualified taxpayers. A lot of taxpayers, however, remain baffled by the rules and information needed to be disclosed in the RPT Form and TPD despite the number of revenue issuances that the Bureau has released.

To enlighten taxpayers, here are the consolidated guidelines and additional clarifications by the BIR on the filing of the RPT form and preparation of TPD as provided under Revenue Memorandum Circular (RMC) No. 54-2021.

TAXPAYERS REQUIRED TO FILE RPT FORM
All three conditions below should be present before a taxpayer is required to file an RPT Form:

(1) the taxpayer is required to file an AITR;

(2) it has transactions with a domestic or foreign related party during the concerned taxable period; and

(3) it falls under any of the following categories as set forth in Section 2 of RR No. 34-2020:

(a) large taxpayers;

(b) taxpayers enjoying tax incentives;

(c) taxpayers reporting net operating losses for the current taxable year and the immediately preceding two (2) consecutive taxable years; or

(d) a related party that has transactions with (a), (b) or (c).

Taxpayers enjoying tax incentives include Board of Investments (Bol)-registered enterprises, economic zone enterprises, and entities enjoying Income Tax Holidays (ITH) or entities subject to preferential income tax rates. Entities subject to preferential income tax rates include proprietary educational institutions and hospitals, and regional operating headquarters, among others.

To satisfy the “net operating losses” condition, on the other hand, taxpayers must take note that net operating losses should be based on the annual income tax instead of the amount per audited financial statements (AFS).

MANNER OF FILING
As to the manner of filing, the taxpayer has the option to file the RPT Form manually in the RDO where the taxpayer is registered, or to file it electronically through the Electronic Audited Financial Statements (eAFS) System pursuant to RMCs Nos. 43 and 44-2021.

For taxpayers with tax years ending on Dec. 31, 2020 who filed a provisional AITR electronically on or before April 15, 2021, but have not yet submitted other required attachments including the RPT Form, the BIR clarified in an advisory that the submission of the attachment to the amended AITR is on or before May 30.

It should also be noted the TPD and other supporting documents no longer need to be attached to the RPT Form but must be made available during audit.

TAXPAYERS NOT REQUIRED TO FILE RPT FORM
The enumeration under Section 2 or RR No. 34-2020 is exclusive such that all taxpayers not included are not required to file the RPT Form. Taxpayers not required to file a RPT Form shall include, but shall not be limited to, the following:

(1) those who did not meet the conditions set forth in the previous section of this article, as provided in Section 2 of RR No. 34-2020;

(2) those subject to regular corporate income tax as a whole but have transactions subject to preferential tax rate under tax treaties or the Tax Code, as amended;

(3) taxpayers operating within the economic zone but subject to regular corporate income tax;

(4) international carriers if they are either subject to tax based on their Gross Philippine Billings or gross revenue;

(5) international carriers exempt from tax under a tax treaty or on the basis of reciprocity;

(6) taxpayers exempt from income tax under Section 30 or similar provisions of the Tax Code or special laws;

(7) regional or area headquarters and representative offices of foreign corporations that are not allowed by law to derive income from the Philippines;

(8) post-employment benefit plans if related party transactions consist only of contributions from sponsor employers; and

(9) those required to file a short period return as originally required by law or existing revenue issuances due for filing in 2020, even if the deadline for filing was extended to 2021.

For items (2) and (3), such taxpayers are not required to file the RPT Form if they do not fall under Section 2(a), (c) and (d) of RR No. 34-2020.

Additional disclosures in the Notes to the Financial Statements are required and must state that they are not covered by the requirements and procedures for related party transactions provided under RR No. 34-2020. This requirement only applies, however, to the AFS that are required to be submitted after the effectivity of the said RR. Those with AFS finalized prior to the effectivity of the RR are not expected to comply with the additional disclosure requirement.

PREPARATION OF A TPD
Sections 2 and 3 of RR No. 34-2020 are interrelated, such that if the taxpayer is not required to file the RPT Form, then it is not also required to prepare a TPD. However, if the taxpayer has met any of conditions in Section 2, any of the following materiality thresholds must also be met for it to be mandated to prepare a TPD:

(1) annual gross sales/revenue for the subject taxable period exceeding P150,000,000, irrespective of the source and identity of the other party to the transaction (i.e., related or otherwise), and the total amount of related party transactions with foreign and domestic related parties exceeds P90,000,000;

(2) sale of tangible goods involving the same related party exceeding P60,000,000 within the taxable year; or

(3) service transactions, payment of interest, utilization of intangible goods or other related party transactions involving the same related party exceeding P15,000,000 within the taxable year.

Even if the taxpayer is not required to prepare a TPD, it is still advisable to prepare such TPD since there is still a need to reasonably assess and prove whether its dealings with related parties adhere to the arm’s length principle, in case of BIR audits.

RPTs TO BE DISCLOSED IN THE RPT FORM
The list of RPTs in RR No. 19-2020 is not exclusive as clarified in RMC No. 76-2020. The RPT shall include within the term all transactions between related parties that result in the transfer of resources, services or obligations, irrespective of their arrangement (with cost-recovery/cost-sharing/recharging) and amount, and regardless of whether a price is charged.

RPTs NOT REQUIRED TO BE DISCLOSED IN THE RPT FORM
The list of RPTs below need not be disclosed in the RPT Form:

(1) Compensation paid to key management personnel;

(2) Dividends, including share in net income from associate or joint ventures;

(3) Branch profit remittances;

(4) RPT covered by an Advance Pricing Agreement (APA) as duly approved and accepted by the BIR;

(5) Contribution of the sponsor employer to the post employment benefit plan.

MANNER OF REPORTING OF AMOUNTS IN THE RPT FORM AND TPD
In accomplishing the RPT Form and in preparing a TPD, both the foreign currency and its equivalent local currency must be used. If it is impractical to disclose both currencies because several foreign currencies were used for the RPT, their equivalent in the local currency should be disclosed instead. In translating the amounts to local currency, the exchange rate to be used should be the rate at the transaction date.

Taxpayers using an internal corporate rate in translating their foreign currency transactions and books of account to local currency and vice versa should evaluate the impact of using such rate instead of following the manner of translation of foreign currencies as prescribed by the BIR. This must be done to be consistent with the requirement of the BIR that the amount of related party transactions to be reported should be based on the actual amount of the transactions, not just based on reasonable estimates.

Moreover, similar transactions with the same related party must be aggregated instead of reporting them on a per-transaction basis, if possible.

As the end of the filing season draws near, we hope that taxpayers are able to see the light at the end of the tunnel. Cheers to my fellow accountants who survived what we can describe as one of the most stressful tax filing seasons!

 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.

 

Christian Derick D. Villafranca 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

3.6M kilos of fish lost due to Chinese vessels in West Philippine Sea

PHILIPPINE STAR/ MICHAEL VARCAS

By Revin Mikhael D. Ochave, Reporter

THE PHILIPPINES has lost 3.6 million kilograms of fish due to the presence of Chinese fishing vessels in the West Philippine Sea, according to estimates from food security advocacy group Tugon Kabuhayan.

This volume is higher than the 240,000 kilos previously estimated by the National Task Force on West Philippine Sea in April, Tugon Kabuhayan convenor Asis G. Perez said in a virtual briefing on Monday.

Mr. Perez said the country stands to further lose 7.2 million kilograms of fish for each month that the Chinese vessels are allowed to stay in the area.

“If we look at even half the market price of this commodity today, then we are bound to lose P720 million a month,” he said.

Mr. Perez asked the government not to downplay the importance of fish products sourced from the West Philippine Sea.

He said that if the area is managed well and limited to Filipino use, it can provide more than the government’s current estimate of 7% volume catch equivalent to P19.1 billion.

Mr. Perez also raised concerns on the destruction of coral reef ecosystems in the Spratly Islands caused by China’s reclamation and dredging activities.

“Studies have shown that the area’s coral reef ecosystem plays an important role as spawning and nursery grounds, egg and larval dispersal of economically important species not only for the West Philippine Sea area but the entire South China Sea and even Pacific Ocean,” he said.

“Clearly, the illegal Chinese activities in the area are detrimental not only for Filipino fishermen. Their actions affect the food security of the entire South China Sea Region. It is just and proper for all citizens to voice out their concern about the current situation,” he added.

The Philippines has filed several diplomatic protests against China after Chinese vessels including six warships were seen within its waters in the South China Sea.

An international tribunal issued a ruling in July 2016 that rejected China’s claim over the West Philippine Sea. However, reports have shown increasing Chinese maritime presence in the area, including the construction of artificial islands.

Tourism frontline staff now part of priority workers for vaccination

DOT
TOURISM Secretary Bernadette Romulo-Puyat gets a body temperature check from a hotel front desk staff during an ocular visit in this Oct. 2020 photo. — DOT PHOTO RELEASE

FRONTLINERS in the tourism industry such as hotel reception staff are now part of the cluster of essential workers who are next in line as priority for coronavirus vaccination.

Tourism Secretary Bernadette Romulo-Puyat, who has been lobbying for the inoculation of the sectors’ workers, said 1,510 frontliners from accredited accommodations, mainly those being used as quarantine or isolation facilities, have been vaccinated as of April 30.

“I am  pleased to announce that the vaccination of those in the A4 Priority Group, which includes tourism frontline workers, has begun,” she said in a statement on Monday.

In a separate Viber message, Ms. Puyat said most of the initial inoculations were administered using vaccine allocation to local government units (LGUs) that have already covered their other priority groups.

“Some LGUs have started na since they’re done with A1 to A3,” she said.

The A1 to A3 groups cover medical workers, senior citizens, and persons with comorbidities.

OTHER TOURISM FRONTLINERS
Apart from accommodation front desk staff, workers assigned at airports, airlines and other transportation services are also included in the A4 priority list.

Ms. Puyat said their vaccination “is a testimony of the government’s firm resolve to ensure that the Philippine tourism industry will continue to survive this pandemic and thrive after it.”

The Department of Tourism has been in coordination with industry groups like the Philippine Hotel Owners Association, the Hotel Sales and Marketing Association, and the Hotel and Restaurant Association of the Philippines for identifying those who will be included in the vaccination list.

“Tourism has always played a major part in uplifting the economy before the pandemic, and it is only by ensuring the good health and safety of our tourism workers through their inoculation can we be assured that they will be ready once the industry fully restarts,” she said.

The government is aiming to vaccinate those in the A1-A4 lists within the first half of the year, according to the national task force handling the coronavirus response. — Marifi S. Jara and Jenina P. Ibañez

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