MANILA – The chairman of the House Ways and Means Committee anticipates President Rodrigo Duterte to emphasize the need of completing the Comprehensive Tax Reform Program as he gives his final State-of-the-Nation Address (SONA) on July 26.
The passage of the proposed Real Property Valuation and Assessment Reform Act and the suggested Passive Income and Financial Intermediaries Taxation Act (PIFITA), according to Albay Representative Joey Salceda, would be a net benefit for the country’s credit rating.
Both reforms are now being considered by the Senate.
He stated that during his final SONA, Duterte would also highlight the need to create new revenue streams.
“Some weeks ago, he mentioned the strategic importance of a well-regulated gaming sector to economic and fiscal recovery,” Salceda said.
Salceda said that a week after the SONA, the House and Senate will agree on an approved version of the tax regime on Philippine Offshore Gaming Operations (POGO).
He also mentioned e-sabong taxes, which the House has already forwarded to the Senate as a potential revenue source.
He emphasized that amending the Foreign Investments Act, the Public Service Act, and the Retail Trade Liberalization Act (RTLA) will be “essential” to boosting foreign direct investment and creating new jobs.
The RTLA is currently in bicameral conference, while the other two are on the Senate floor.
He also stressed the importance of making the Corporate Recovery and Tax Incentives for Enterprises (CREATE) law operate, as it might lead to increased international investment.
“The net inflow of foreign direct investments (FDIs) more than doubled to USD679 million in April from USD317 million in 2020. But, to maximize its impacts, we need a well-trained and well-equipped labor force capable of filling in the jobs FDIs will create,” he said.
He believes that a bigger role for the Technical Education and Skills Development Authority (TESDA) is needed to build a skills-based education system.
“I am hoping President Duterte will reiterate the need to transform TESDA into a cabinet-level agency capable of implementing a massive national upskilling program. Along with this, I hope President Duterte also emphasizes the need for a skills-centric education system,” he said.
If Congress is to pass the rest of Duterte’s fiscal and economic reforms, he has stated that the 2022 national budget must be approved as soon as possible.
He also mentioned that the Development Budget Coordinating Committee would meet on Monday to discuss their earlier objections about a third stimulus package.
“In any case, we need some form of stimulus as vaccination picks up. Stimulus packages work best when demand begins to normalize because they create momentum. The figure in consideration is PHP173 billion or whereabouts. We will keep a close eye on these discussions,” he said.
He stated that the House Ways and Means Committee is working on a number of additional bills, including a Fiscal Regime for Mining, the Ease of Paying Taxes Act, the Motor Vehicle Road Users’ Tax, and the Excise Tax on Single-Use Plastics.
“Although this is President Duterte’s last SONA, the Committee remains focused on enacting as many of these pending reforms as possible. The tone of President Duterte’s SONA, especially in our current socio-economic context, will also likely zero in on the work that still needs to be done,” he said.