BusinessWorld | April 22, 2021 | 8:05 pm
THE DEPARTMENT of Finance (DoF) said it will “work hard” to ensure the passage of the last two tax reform bills before the campaigning heats up for the 2022 national elections.
In a webinar Thursday, Finance Undersecretary Antonette C. Tionko said the start of the campaign period for the 2022 elections will slow the progress of remaining tax bills and other measures pending in Congress. However, she said the DoF is determined to pass the remaining measures to complete the administration’s Comprehensive Tax Reform Program (CTRP).
“Obviously once the filing of candidacy (starts), they will likely not be interested in passing that. However, there is no stopping our trying to pass them. If it’s been certified as urgent by the president, then certainly it will take precedence,” Ms. Tionko said in the webinar arranged by the British Chamber of Commerce of the Philippines, Inc.
The national elections take place in May 2022, with a 90-day campaign period before votes are cast.
“The next two packages are land valuation, which is bound to be political, and PIFITA. I think this time, we will work hard to pass these to complete the tax reform,” she added.
The proposed Real Property Valuation and Assessment Reform Act and the Passive Income and Financial Intermediary Taxation Act (PIFITA) were the third and fourth packages of the CTRP, respectively.
The third package is meant to create a uniform property valuation system to address conflicts and inconsistencies in the valuation of land. The measure is also expected to generate more revenue for local government units.
The House of Representatives approved its version of the property bill on third reading in November 2019, while the Senate version is still pending at committee level.
PIFITA, which seeks to simplify the schedule of taxes on financial instruments to 26 separate rate packages from 80, was approved at the House in September 2019 while the counterpart bill remains pending in the Senate.
In light of the decline in tax collections due to the pandemic, Ms. Tionko said the government is also looking at more revenue-generating tax bills to compensate.
“For the packages, we can expect them to be passed in the House but in the Senate, that’s where it will take a long time,” she said.
At the forum, Alex B. Cabrera, chairman and senior partner at PwC Philippines, said there is potential for the government to tap electronic commerce as a source of additional revenue if the tax regime is overhauled to cover major online sellers.
The Bureau of Internal Revenue collected P127.4 billion in taxes in March, 13% short of its P146.3-billion target after the hard lockdown imposed towards the end of the month dampened business activity This total was also 3.2% lower year on year.
The Bureau of Customs exceeded its collection target for the third straight month, outperforming the March goal by 14% with collections of P54.5 billion. — Beatrice M. Laforga
