By Margaret Claire Layug, August 30 2018; GMA Network
Image Credit to Manila Bulletin
Senator Joel Villanueva on Thursday suggested putting off the implementation of the second package of the Tax Reform Acceleration and Inclusion Law.
Asked to elaborate on his concerns during an interview on ANC, Villanueva said that he thinks the country should wait a little longer for TRAIN to take effect before instituting the second package, now called TRABAHO (Tax Reform for Attracting Better and High-quality Opportunities).
The senator also criticized the country’s economic managers for underestimating the supposed inflationary effects of the first package of the government’s Comprehensive Tax Reform Program (CTRP).
“I think there are some miscalculations on the part of our economic managers when you talk about inflation rate,” he said.
The Department of Finance, Bangko Sentral ng Pilipinas, and National Economic Development Authority had been questioned in a Senate inquiry why they were not able to forecast that the inflation rate would breach the 2- to 4-percent target range.
“One of the highest,” Villanueva said. “So, in order for us to address this issue, hindi naman kaagad dapat TRAIN 2 ‘yung ipasok.”
Citing other measures, he said, “One of which is, of course, I support rice tariffication. Another thing is, why not lower our VAT from 12 percent to 10 percent?”
TRABAHO seeks to gradually lower corporate income tax (CIT) rates to 20 percent from 30 percent, or by 2 percent annually starting 2021.
Villanueva said that the proposed measure would have a minimal effect on Filipinos, particularly the poor.
“It’s not even a guarantee that if you lower the corporate income tax, babaha ‘yung mga negosyante o negosyo dito sa bansa,” he added.
Senate President Vicente Sotto III had admitted that the majority of senators are not inclined to push for TRAIN 2’s passage even if it was mentioned by President Rodrigo Duterte during his third State of the Nation Address. — Margaret Claire Layug/BM, GMA News