By Bernadette D. Nicolas, May 17 2019; Business Mirror
Image Credit to Business World
TRADE Secretary Ramon Lopez has once again called on the next Congress to finally pass economic bills on the liberalization of retail trade, the Public Service Act and the Tax Reform for Attracting Better and High-Quality Opportunities (Trabaho) bill.
Lopez said the Executive has long been pushing for the passage of these measures.
“Some bills or legislation that we would like to push,” Lopez said, pertain “generally to the liberalization of more industries that will be open to foreign equity—so the retail trade, public service and essentially shortening the foreign negative list, the tax reform package 2 that will bring down the corporate income tax” are crucial pieces of legislation they want to pitch to the 18th Congress.
Lopez addressed reporters on Thursday during The Virtual Presser hosted by the Presidential Communications Operations Office Global Media Affairs.
The Retail Trade Liberalization Act aims to further open up retail trade industry to foreign participation. Lopez also since been pushing for the amendment of 82-year-old Public Service Act.
According to the 1987 Constitution, public utilities must be solely operated by firms that are 60-percent owned by Filipinos.
Under the 17th Congress, bills were filed in both houses of Congress seeking to clearly define what public utilities are, and in the process lift foreign ownership restriction on sectors that fall outside of it, particularly telecommunications.
Meanwhile, the Trabaho bills seeks to gradually reduce corporate income tax to 20 percent by 2029, from 30 percent.
On the other hand, it will rationalize incentives granted to firms located in special economic zones managed by the Philippine Economic Zone Authority (Peza).
On the Trabaho bill, Lopez reiterated that they have been working with the Department of Finance to possibly smoothen the transition period, especially for existing exporters in the ecozones. This, he said, is the main issue with the Trabaho bill.
“When we say smoothen the transition, if we are to put them on a time-bound basis, we just have to manage the transition. In other words, prolong the time-bound deadline of those incentives that they now enjoy —this is just for the existing—or probably agree to a higher GIE [gross income earned rate]. Right now they are at 5 percent and we can just say grandfather rule: in other words, all those who are enjoying [will] continue to enjoy but [must] pay a little more; and I think we are gaining acceptance on that alternative,” Lopez said.