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Philippines lifts travel ban on Taiwan

PRESIDENT Rodrigo R. Duterte has lifted a novel coronavirus-related travel ban on Taiwan, days after the Chinese territory threatened to retaliate.

“Travel may now be made by any national to Taiwan from the Philippines and vice versa,” presidential spokesperson Salvador S. Panelo said in a statement on Friday, citing strict measures adopted by Taiwan to contain the virus that has killed more than a thousand people and sickened tens of thousands more in China.

Mr. Panelo issued the statement after an inter-agency task force met on Friday to discuss the travel ban.

The task force would also evaluate protocols enforced by other Chinese jurisdictions, including Macau, for the possible lifting of the travel ban.

“The Office of the President likewise stresses that any resolution relative to travel restrictions in connection with the COVID-19 shall be subjected to regular review by the IATF,” Mr. Panelo said, referring to the novel coronavirus’s clinical term.

Earlier on Friday, Senator Panfilo M. Lacson criticized Mr. Duterte for failing to consult other sectors before ending a military deal with the US on the deployment of troops for war games.

“We elected a president who does not appear to give much importance to counsels and consultations with sectors that could very well help him arrive at well-informed decisions,” he said in a statement.

The senator also alluded to Mr. Duterte’s decision to include Taiwan in the travel ban.

The presidential palace earlier claimed the ban had nothing to do with the Philippines’ One-China policy.

“Politically, it seems that the China lobby has become a very powerful force under this administration,” Mr. Lacson said.

“Only time will tell if this major shift in the country’s foreign policy will benefit our people in the medium and long terms,” he said.

He added that the travel ban might already have potentially dire consequences for Filipino workers in Taiwan.

Taiwan is home to more than 150,000 Filipino migrant workers. There were 241,000 tourist arrivals from Taiwan in 2018, according to local tourism data. — Charmaine A. Tadalan

House constitutional panel considering expanded local gov’t IRAs

THE House committee on constitutional amendments is considering including among its recommended changes to the charter a provision to expand internal revenue allotments (IRAs) for provinces, cities, towns, and barangays throughout the country, its chairman said.

The committee’s chairman, Cagayan de Oro Rep. Rufus B. Rodriguez said in a statement on Friday that he and several committee members are supporting the proposal of the administration’s Inter-Agency Task Force on Constitutional Reforms for a larger IRA for LGUs.

IRAs are payments from the national government representing LGUs’ share of the national government’s income, and makeup a significant portion of local government budgets

“LGUs are entitled to it. That is what the Supreme Court (SC) has declared in the Mandanas case,” he said, referring to a petition filed by Batangas Governor Hermilando I. Mandanas.

The SC ruling expanded the basis for calculating the IRA to include not only taxes collected by the Bureau of Internal Revenue but the Bureau of Customs as well. It also included half of the value added tax (VAT) from the autonomous Muslim region, 60% of levies from the exploitation of natural wealth, and half of VAT on the sale of goods and properties.

At present, IRA is computed based on “internal revenue taxes,” or those collected by the Bureau of Internal Revenue.

This year, P649 billion was appropriated in the national budget for IRA payments, he said.

According to a study by the Department of Interior and Local Government (DILG), Mr. Rodriguez said LGUs will come in for an IRA payment of P1.12 trillion in 2022 if the calculations were compliant with the SC ruling, some P313 billion more than they would get under the current method of reckoning IRA.

Mr. Rodriguez said the expanded IRA ruling would give provinces an additional P268 billion, and cities, towns and barangays P268 billion, P397 billion and P233 billion, respectively.

The Department of Finance has opposed the immediate implementation of the SC ruling because of its “negative impact” on national finances, Mr. Rodriguez said.

President Rodrigo R. Duterte has created a task force to come up with the administration’s recommended Constitutional amendments. The group, composed of nine agencies, is chaired by Local Government Secretary Eduardo M. Año, with Justice Secretary Menardo I. Guevarra as vice chairman.

The task force has proposed constitutional provisions against political dynasties and party turncoats, election of senators by region, five-year terms for members of the House of Representatives and local officials, the lifting of limitations on foreign investment, and a state subsidy for political parties.

Most of the task force’s proposed constitutional amendments “jibe” with those contained in the committee’s initial report, Mr. Rodriguez said.

The House committee will meet next week to vote on which proposals of the task force it will include in its report to Speaker Alan Peter S. Cayetano. — Genshen L. Espedido

Kuwait deployment ban for household workers lifted

LABOR Secretary Silvestre Bello III announced Friday the lifting of the deployment ban on household service workers to Kuwait.

“After due consultation with the Department of Foreign Affairs (DFA) and with the filing of appropriate charges against the perpetrators (in the killing) of (Overseas Filipino Worker) Jeanelyn P. Villavende, the Governing Board of the POEA (Philippine Overseas Employment Administration) unanimously approved the lifting of the remaining ban in Kuwait with respect to the deployment of household workers,” Mr. Bello said in a statement.

In POEA governing board resolution no. 7 approved on Feb. 13, the government will now resume processing the papers of and deploying all types of workers bound to the Gulf state.

Mr. Bello, who chairs the POEA governing board, said the approval was made in view of the filing of charges against the suspected killers of Ms. Villavende.

Last month, the Department of Labor and Employment (DOLE) imposed a total deployment ban of OFWs to Kuwait following findings by the National Bureau of Investigation (NBI) that Ms. Villavende was sexually abused before being murdered.

However, in view of the approval early this month by the Kuwait and Philippine governments of a harmonized employment contract for Filipino domestic workers in Kuwait, the POEA governing board lifted the ban on the processing and deployment of OFWs to Kuwait, except for newly-hired and returning domestic workers.

More than half of the 250,000 documented workers in Kuwait are household workers.

According to DoLE, the salient provisions of the standard employment contract include a prohibition an holding on to the worker’s travel documents and identification cards, and the worker’s right to own a phone and use it outside working hours.

Under the deal, OFWs are also entitled to a paid day off per week and cannot work for more than 12 hours a day.

Employers are also prohibited from assigning a domestic worker to work outside of Kuwait or be transferred to another employer without the OFWs’ written consent. — Genshen L. Espedido

New Harbor Link exit in Malabon operational by Feb. 21

THE Department of Public Works and Highways (DPWH) said the Malabon Exit of the 2.6-kilometer C3-R10 Section of the NLEX Harbor Link Segment 10, will be open to motorists beginning Feb. 21

Public Works Secretary Mark A. Villar told reporters Friday that the ramp from the new Caloocan Interchange, C3 Road in Caloocan City to Dagat-Dagatan Avenue will officially open next week, Feb. 21.

He said the entire 2.6-kilometer C3-R10 Section, which will connect to NLEX Harbor Link Segment 10, is expected to be operational by next month.

The 5.65-kilometer NLEX Harbor Link Segment 10 is an elevated toll road that passes through Karuhatan, Valenzuela City, Governor Pascual Avenue in Malabon City, and 5th Avenue/C3 Road in Caloocan City.

Reporters were in Caloocan City on Friday to witness the final inspection of the C3 to Dagat-Dagatan segment led by Mr. Villar and officials of the NLEX Corp. This segment, Mr. Villar said, will serve as an alternate corridor for vehicles bound for the port area from NLEX.

NLEX Corp. Senior Vice-President for Communication Romulo S. Quimbo, Jr. has said that about 20,000 vehicles are expected to benefit from the alternative ramp.

“We are making sure that all the safety features of the expressway are in place before we open it to the public,” Mr. Villar said.

Once fully completed by March, travel time from Port Area to NLEx will fall to 10 minutes, according to Mr.Villar.

For his part, NLEX Chief Operating Officer Raul L. Ignacio said: “We are anticipating that truckers and freight forwarders will greatly benefit from this new road since their cargo trucks will have 24/7 access, and in turn translate to faster delivery of goods to and from the provinces in North and Central Luzon.” — Arjay L. Balinbin

Palay farmgate price firms in late Jan.

THE AVERAGE farmgate price of palay, or unmilled rice, rose 0.3% to P15.94 per kilogram (kg) in the last week of January, a price level that remains 19.2% lower year-on-year, the Philippine Statistics Authority said.

According to its weekly update on palay, rice and corn prices, the average price of wholesale well-milled rice (WMR) declined 0.9% week-on-week to P37.01, while retail prices dropped 0.2% to P41.30 . WMR prices were down 8.2% year-on-year.

The average wholesale price of regular-milled rice fell 0.03% week-on-week to P32.96 while the average retail price rose to P36.44.

Domestic rice prices have been declining since the implementation of the Rice Tarrification Law which removed restrictions on imports of cheap foreign rice, with Southeast Asian grain charged a 35% tariff.

The average farmgate price of yellow corn grain rose 0.8% week-on-week to P12.52 per kg. The average farmgate price of white corn grain fell 0.1% to P13.35.

The average wholesale and retail price of yellow corn grain both rose one percent to P22.11 per kg and P25.30 per kg, respectively.

The average wholesale price of white corn grain fell 0.7% week-on-week to P16.63. The average retail price rose 2.2% to P26.92. — Revin Mikhael D. Ochave

Food industry seeking to expand Mideast footprint via Gulf fair

THE Philippines is seeking to expand the reach of its products in the Middle East, the Trade department said on Friday.

In a statement, the Department of Trade and Industry (DTI) said the Philippine Trade and Investment Center-Middle East and Africa is currently mounting an outbound business matching mission (OBMM) in the Middle East between Feb. 12 and 24.

“The OBMM is in conjunction with Gulfood 2020 in Dubai World Trade Centre,” the DTI said. “Gulfood is the world’s largest annual food, beverage, and hospitality exhibition which attracts F&B professionals from all over the world to Dubai.”

The mission aims to help the food sector diversify its markets.

“The featured products for this mission are food items, sauces, spices, mixes, and condiments as well as cargo and logistics,” the Trade department said.

Philippine companies participating in the mission are Fitrite, Inc; Fruits of Life, Inc; HDR Foods Corp; Jocker’s Food Industries; Magic Melt Food, Inc; Marigold Manufacturing Corp; Marikina Food Corp; Pinesvill Trading FZE LTE; Pixcel Transglobal; Sagrex Food, and LBC.

DTI-Trade Promotions Group (TPG) Undersecretary Abdulgani M. Macatoman said: “We hope that through this OBMM, the Philippines will be able to explore the business environment and possible prospects in the Middle East markets and sustain networking and follow-up activities in the UAE as part of the mission legs last 2019.”

DTI-Export Marketing Bureau Director Senen M. Perlada said Philippine exporters will be meeting with prospective partners or buyers in the Middle East.

The engagement, Mr. Perlada said, will give Philippine exporters knowledge of the market requirements “in terms of volume, quality, and price.”

The DTI estimates that the Philippines exported a total of $720.1 million worth of goods to the Middle East in the 11 months to to November.

Goods imported from the Middle East during the period amounted to$3.3 billion.

“Among the top products exported by the country were bananas, including plantains, fresh or dried ($211.9 million), input or output units, whether or not containing storage units in the same housing ($64 million), other bread, pastry, cakes, biscuits and other baker’s wares, whether or not containing cocoa ($41.3 million), pineapples, fresh or dried ($38.1million), and video projectors ($22.1 million),” the department said.

The Philippines’ top imported products from the Middle East were “petroleum oils and oils obtained from bituminous minerals, crude ($2.1 billion), light petroleum oils and preparations thereof ($225.9 million), propane, liquified ($126.6 million), butanes, liquified ($120.9 million), and aeroplanes and other aircraft, of an unladen weight not exceeding 2,000 kg ($72.7 million).” — Arjay L. Balinbin

BIR adds PayMaya to online payment platforms

THE Bureau of Internal Revenue (BIR) said Friday it expects to grow the volume of taxes paid online after launching a seventh electronic channel through e-wallet service PayMaya.

BIR Deputy Commissioner for Information Sysyems Group Lanee C. David said electronic filers (e-filers) have increased over the years after the opening of various digital platforms.

Last year, Ms. David said the number of e-filers nearly tripled from 2015 levels to 1.796 million, including 60% of the bureau’s business taxpayers.

“Now with the addition of PayMaya, we are expecting a significant shift in favor of electronic payments and of course, a significant increase in our e-filers,” she said.

She said PayMaya could expand the taxpaying demographic particularly for its client base of individuals and the unbanked, since the platform does not require users to have bank account.

The other six electronic payment systems in use for tax payments are electronic filing and payment system (eFPS), Globe GCash, Development Bank of the Philippines’ PayTax Online, the e-Tax Payment System (eTPS) of the Land Bank of the Philippines and Union Bank’s Online Tax Payment facility.

“We are happy to offer PayMaya as a new payment channel where individual Filipino taxpayers can easily remit their taxes no matter where they are in the country,” BIR Commissioner Caesar R. Dulay said.

On the sidelines of the launch yesterday, Ms. David said around 84% of all taxes collected by the bureau in 2019 were received through online portals, most of which were from large taxpayers such as businesses, with the remaining 16% collections were received over the counter.

The Finance department reported Thursday that tax payments done online nearly doubled last year, with the total amount of tax payments processed online surging 92% to P1.2 billion in 2019.

The number of electronic tax payments also increased to 446,753 total transactions, up 60%, it said.

DoF Undersecretary and Head of the Revenue Operations Group (ROG) Antonette C. Tionko said the department aims to convert over 15 million transactions currently paying over the counter to digital payment services, equivalent to 80% of the total number of transactions the BIR processes annually.

The PESONet platform could save the bureau as much as P230 million annualy in transaction fees if taxes are paid online, as this will lower fees charged by authorized banks to P25 from P40 for over-the-counter dealings. — Beatrice M. Laforga

BSP advises institutions to stop withholding tax on some payments to central bank

FINANCIAL institutions have been advised to stop withholding taxes on their payments to the Bangko Sentral ng Pilipinas (BSP) following the implementation of a BSP tax exemption under the New Central Bank Act.

In a circular, Bangko Sentral ng Pilipinas (BSP) Deputy Governor Chuchi G. Fonacier said the advisory follows Revenue Regulations No. 2-2020 issued by the Bureau of Internal Revenue, which lays out the BSP’s exemption from paying national internal revenue taxes on income from its governmental functions.

“In this respect, all BSFIs (BSP-supervised financial institutions) and OPSs (operators of payments) can now discontinue the withholding of taxes on their payments to the BSP in relation to the above-mentioned transactions or activities,” Ms. Fonacier said.

Finance Secretary Carlos G. Dominguez, III said that the revenue regulations will cover BSP income including those activities that are related to the central bank’s primary objectives to supervise over bank operations.

It will also include those related to the BSP’s regulatory and examination powers over quasi-banks, money service businesses, credit-granting businesses and payment system operators.

Activities related to the central bank’s mandate to maintain price stability, monetary and financial stability, and the convertibility of peso will also be included in the tax exemption.

“All other incomes not included in the above enumeration shall be considered proprietary income and shall be subject to all applicable national internal revenue taxes,” Ms. Fonacier said.

The New Central Bank Act provides for a BSP exemption from all national, municipal and city taxes, fees, charges, and assessments, for five years after the law’s approval.

According to the law, the tax exemption will also be applicable to BSP’s properties, resources, receipts, expenditures, profits, and income.

Likewise, contracts, deeds, documents and transactions that are related to the BSP’s conduct of business will also be included in the tax exemptions.

“Bangko Sentral itself would otherwise be liable, and shall not apply to taxes, fees, charges, or assessments payable by persons or other entities doing business with the Bangko Sentral,” according to the law.

The law was passed in February 2019.

Peso firms week-on-week after Fitch raises outlook

THE peso weakened to P50.56 to the dollar on Friday, though it rode positive sentiment to strengthen week-on-week after a sovereign credit outlook upgrade by Fitch Ratings to “positive” from “stable.”

The peso fell from its Thursday close of P50.50 but rose from P50.755 a week earlier.

It opened yesterday at P50.47 against the dollar, with a low of P50.58 and a high of P50.42.

Dollar volumes fell to $831.5 million from $1.106 billion Thursday.

A trader said the Friday weakness was due to “stronger-than-expected US inflation reports overnight.”

Reuters reported that growth in the US consumer price index (CPI) accelerated to 0.2% in January from 0.1% in December.

Asked about the week-on-week gains, another trader said the peso rose “driven by the Fitch’ announcement of an outlook (upgrade from) positive to stable… along with the narrowing trade deficit,”

Fitch announced the upgrade Tuesday, saying it expects the Philippines’ sound macroeconomic policy framework to continue, bolstering growth and keeping inflation stable.

Fitch kept the credit rating at “BBB.”

The Philippine Statistics Authority reported that the trade deficit narrowed to $37.05 billion last year compared to the $43.53-billion deficit in 2018.

BSP eyes another rate cut in Q2 amid outbreak

THE Philippine central bank may cut the key rate by another 25 basis points (bps) as early as the second quarter to shield the economy from the effects of a deadly coronavirus outbreak, according to its chief.

Bangko Sentral ng Pilipinas Governor Benjamin E. Diokno told reporters on Friday the outbreak that has killed more than a thousand and sickened tens of thousands more in China was an economic risk.

The policy-making Monetary Board might enforce the rate cut next quarter if the health menace takes a bigger toll on the country’s growth than what economic managers had expected, he said.

“Our target is maybe second quarter or second half of the year,” Mr. Diokno said.

“At the moment, I don’t see the need for monetary easing other than what we have done,” he said. “We are happy where we are right now.”

BSP cut benchmark interest rates on Feb. 6 to take advantage of slower price increases and shield the economy from the effects of a deadly coronavirus outbreak.

The Monetary Board cut the key rate by 25 bps to 3.75% at its first policy meeting of the year, in line with market expectations.

Mr. Diokno at that time said the spread of the virus could affect economic activity and market sentiment in the coming months.

The manageable inflation environment “allowed room for a preemptive reduction in the policy rate to support market confidence,” he said.

The decision followed 75 bps of rate cuts last year and 175 bps of rate increases in 2018 amid a high inflation environment.

January inflation picked up more than expected to an eight-month peak of 2.9%, but it was still within the central bank’s comfort range.

The rate was faster than 2.5% in December but slower than 4.4% in January 2019, according to data from the Philippine Statistics Authority.

It was still within the central bank’s 2-4% target for the year.

Mr. Diokno said BSP would opt to use traditional monetary policy tools if the need arises.

“We can tap the traditional rate cuts or reserve requirements,” he said. “We don’t need to resort to other measures.”

The Monetary Board’s next policy meeting is on Mar. 19. It will also hold policy meetings on May 21 and June 25. — Luz Wendy T. Noble

Senate to meet with Executive on legislative agenda

PALACE and Finance officials will separately meet with Senate leaders next week to discuss President Rodrigo R. Duterte’s legislative agenda, Finance Secretary Carlos G. Dominguez III said on Friday.

This comes after Senate President Vicente C. Sotto III said the chamber won’t be able to pass a bill that seeks to lower corporate income tax and rationalize tax incentives by March.

Senate leaders will meet with Palace officials on Monday, to be followed by a meeting with Finance officials two days later, Mr. Dominguez told reporters in a Viber message.

He said he remained hopeful that the Senate would approve the measure before Congress takes a seven-week Holy Week break.

Mr. Sotto earlier cited the intricacies in the proposed Corporate Income Tax and Incentives Rationalization Act (CITIRA) and Passive Income and Financial Intermediary Taxation Act (PIFITA).

Mr. Dominguez last week said the bill seeking to lower corporate income tax would rationalize the government’s “tangled” tax incentive scheme, which has forced it to forego hundreds of billions of pesos in revenue.

Also referred to as the second package of the Comprehensive Tax Reform Program (CTRP), it is one of Mr. Duterte’s priority measures.

Aside from the P441 billion pesos the government “gave away as tax discounts,” some companies that avail themselves of fiscal perks cheat the state by abusing transfer pricing rules or by shifting profits and costs to cut tax liabilities. The latter costs the government about P504 billion in a year, he said.

Senators are still discussing the bill. The House of Representatives approved a counterpart measure in September last year.

The Finance department wants the remaining tax measures under the tax reform program to be approved before the campaign season for the 2022 presidential and general elections kicks in.

All of the remaining bills under the tax reform program are still at the committee level, Mr. Sotto said in a mobile-phone message, adding that he could not guarantee their approval on time.

The passive income bill, which will simplify the tax structure by halving the 80 combinations of tax base and rates on passive income and financial transactions, is pending at the Senate committee level.

“The complicated tax structure makes tax administration and compliance difficult and costly for both government and the private sector,” Mr. Dominguez said in his speech last week.

Other pending tax reform bills include one that seeks to simplify real property valuation and assessment and another that will raise the government’s share in mining revenue.

Mr. Dominguez said the remaining tax packages will “help produce a more business-friendly environment.”

“While we await the passage into law of these remaining tax reform packages, we continue to implement measures that will reinvigorate our capital markets, boost investor confidence and enhance financial inclusion,” he said. — Beatrice M. Laforga

Court orders arrest of ex-Senator Trillanes

A QUEZON City court has ordered the arrest of a former senator critical of President Rodrigo R. Duterte after he was indicted for inciting to sedition last month.

Former Senator Antonio F. Trillanes IV and 10 co-accused may post a P10,000 bail, according to the Metropolitan trial court.

The Justice department last month indicted Mr. Trillanes along with 10 other people including for allegedly circulating a series of videos accusing President Rodrigo R. Duterte and his family of being in the illegal drug trade.

It dismissed the sedition, inciting to sedition, cyberlibel, libel, estafa and obstruction of justice complaint against all 31 respondents, including Mr. Trillanes, Vice President Maria Leonor G. Robredo, detained Senator Leila M. De Lima, former Senator Paolo Benigno A. Aquino IV, and other opposition candidates during the midterm elections.

Human Rights Watch earlier said authorities should drop the “preposterous complaint” against opposition politicians, religious leaders and human rights advocates.

It said the case was a “transparent attempt to harass and silence critics” of Mr. Duterte’s bloody drug war. — Vann Marlo M. Villegas

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