By Arjay L. Balinbin, July 25 2019; Business World
Image Credit to Philippine Star
THE HOUSE of Representatives targets to approve all remaining tax reforms within the year, Deputy Speaker for Finance Camarines Sur 2nd District Rep. Raymond F. Villafuerte, Jr. said on Wednesday.
“Actually we’re targeting all of these by this year,” Mr. Villafuerte said in a press briefing at the Malacañan Palace, referring to tax reforms that failed to make it out of the 17th Congress which ended on June 3.
Finance Undersecretary Karl Kendrick T. Chua said in the same briefing: “In general, we would like… to have all of them approved by Congress — both houses — within the year, and hopefully the regular meetings and coordination between the Executive and Congress — the House and the Senate — will facilitate that process.”
Sought for comment, Senate President Pro Tempore Ralph G. Recto said in a mobile phone message: “The Senate will have to wait for the House to pass its version.” By law, tax measures are supposed to emanate from the House, although in practice the Senate holds parallel hearings on its own versions in order to save time but still waits for House approval.
Mr. Chua also told reporters that Malacañang officials had told him that President Rodrigo R. Duterte can be expected to sign “this week” the bill that will gradually increase the excise tax rate on tobacco products to P60 per pack by 2023 from P35 currently.
“It is an enrolled bill that was transmitted last June 27 to Malacañang, and that means it will lapse into law on July 27… I was told it will be signed this week because that is a priority measure, certified urgent by the President in the previous Congress and mentioned by the President in the SONA (State of the Nation Address),” he said.
The government has so far enacted Republic Act No. 10963 that slashed personal income tax rates but either added or increased levies on several products and services and RA 11213 or the Tax Amnesty Act of 2019.
Remaining tax reforms include proposals to reduce the corporate income tax to 20% by 2029 from 30% currently, to overhaul the fiscal incentives system, to centralize real property valuation and assessment, to increase the government’s share in mining revenues, to simplify the tax structure for financial investment instruments and to further increase the excise tax on alcohol products. All these had been approved on final reading in the House by December last year but remained at the committee level in the Senate as the 17th Congress adjourned on June 3.
Mr. Chua said another bill will be filed imposing a P45 excise tax on vapes and heated cigarettes, which are already included in the tobacco bill awaiting the President’s signature. “Well, in the bill that was approved, ‘yung heated tobacco is P10 per pack; we want it P45 per pack — similar to the regular cigarette para fair,” he said, referring to the heated cigarettes.
“Doon sa vapes, ‘yung e-cigarette, ‘yung P10 per milliliter, we are proposing P45 per milliliter…”
As for the strategies that will be carried out to ensure legislative approval of remaining tax reforms within the year, Mr. Chua said: “Because all bills will have fiscal implications, [what we will do] is to establish weekly meetings with members of Congress. And that is exactly what I am doing for the tax reforms, and what my colleagues are doing.”
“Ang instruction po ni Secretary [Carlos G. Dominguez III] is we have to do it regularly. So four times a week I’m usually meeting a legislator to understand their concerns and also to convey our position on certain bills,” he explained.
“I started July 1 with the new Congress, so we have been briefing those who have been interested to file and support some of our bills, and this continues.”
He said departments and agencies involved in the meetings include the Department of Finance, National Economic and Development Authority, and the Department of Budget and Management.
Mr. Villafuerte said the direction of House Speaker Alan Peter S. Cayetano is “to really have regular meetings not only with the Executive, not only with the (Cabinet) Economic Cluster… but importantly also, to have regular meetings with the Senate — that’s the direction of the Speaker.”
“And during the SONA, we briefly talked to Senate President [Vicente C.] Sotto and he really likes this idea.”
Mr. Chua said further, “There’s also the proposal to have more frequent LEDAC (Legislative Executive Development Advisory Council meetings) either at the technical level so that lahat ngbills po ay ma-vet, and when we present our position to Congress, it is more unified.” — Arjay L. Balinbin