THE government should ensure that the Tax Reform for Attracting Better and High-Quality Opportunities (TRABAHO) boosts Philippine competitiveness as an investment destination, the Tax Management Association of the Philippines, Inc (TMAP) said.
“Ang call namin is to further study it (our call is for further study), kasi the way the TRABAHO Bill is crafted, kumonti talaga ’yung incentives natin (the way the TRABAHO Bill is crafted, the incentives were reduced),” TMAP President Eleanor L. Roque told reporters Wednesday.
“Sobrang limited na siya to five years (It’s now limited to five years). Our call is to look at the incentive given (the offerings in) the region and see whether we can still be competitive, (because) we’re competing with the investments going to the region. In most cases, even globally,” Ms. Roque added.
Ms. Roque said that firms are looking for higher returns from their investment.
Under the TRABAHO Bill, incentives such as income tax holiday and exemption from Customs duties on importation of capital equipment and raw materials, and the 5% tax on gross income earned (GIE) shall not exceed a period of five years.
The Package 2 of the Comprehensive Tax Reform Program (CTRP) aims to reduce corporate income tax to 20% from the current 30% to attract more investments.
“Compare it with other countries especially ’yung mga kasabayan natin, Indonesia, Vietnam, Malaysia, Thailand. Some of them have the 10 to 15 years, some of them still have the indefinite depending where the investment is. Siguro dapat medyo luminya tayo roon (We should be at par with them) because those are our competitors,” Ms. Roque said.
The Department of Finance (DoF) has earlier said that it will file again the bills that form part of the CTRP in the 18th Congress.
“The business community is especially interested in the second package of the CTRP. For the 18th Congress, we are going to file again the bill to rationalize fiscal incentives and lower the corporate income tax,” DoF Undersecretary Gil S. Beltran said in a statement. — Reicelene Joy N. Ignacio