Socioeconomic agenda ‘put on the fast lane’
From this time on, expect the Duterte administration to work hard to make its 10-point socioeconomic agenda come to fruition as Finance Secretary Carlos G. Dominguez III said the President’s pronouncements Monday reflected the plan to significantly slash the poverty rate and generate more jobs.
Separately, tax managers welcomed President Duterte’s plan to put in place a comprehensive tax reform, including the reduction in income tax rates while also easing the bank secrecy law for tax purposes.
“President Duterte has spelled out in his Sona a wide gamut of political and economic initiatives that will let the new government put on the fast lane its 10-point socioeconomic agenda for a genuinely inclusive growth, in keeping with his electoral mandate for our people to truly benefit from the nascent economic overdrive,” Dominguez said, referring to Mr. Duterte’s first State of the Nation Address last Monday. The socioeconomic agenda is ultimately aimed at slashing poverty incidence to about 16 percent by 2022 from 25 percent at present.
The Finance chief noted that Mr. Duterte’s “must-dos” for inclusive growth included a comprehensive tax reform, communications and transport infrastructure buildup, a “relentless” war on criminality and “fanatical” terrorism as well as “prudent fiscal policies to attack poverty and create enough jobs, especially for the poor.”
“In unmistakable terms, the Chief Executive has spelled out what needs to be done between now and 2022 that will enable his administration to bequeath to the next one a country that is much safer and an economy that is even stronger and more inclusive for the benefit of all Filipinos, especially the poor and underprivileged sectors,” Dominguez said.
“These sweeping initiatives are for us in government to carry out and for Filipinos and private business to give their full backing to in order to guarantee a sustained high—and inclusive—growth for all,” the finance chief added.
Dominguez said Mr. Duterte’s pronouncements that he would accelerate infrastructure spending, modernize agriculture, promote ease of doing business, reform tax administration as well as address traffic congestion in Metro Manila and other urban centers would augur well to make the country more investor-friendly.
“To create an environment more conducive to private investments, the President has outlined pro-business initiatives, including cutbacks in personal and corporate income taxes, relaxing the bank secrecy law, creating alternative airports in Sangley Point in Cavite and at the Clark Special Economic Zone in Pampanga and establishing a national broadband plan that will include the provision of free Wi-Fi in certain public places,” according to Dominguez.
In a separate statement late Monday, the Tax Management Association of the Philippines (TMAP) said they were “very pleased to hear President Duterte’s statement that his administration will pursue tax reforms.”
“We are delighted to see that his proposals for the simplification of the tax system, lowering of the income tax rates, and lifting of the bank secrecy law are the same reforms also espoused by TMAP,” said Benedict R. Tugonon, the group’s president.
“With the clear pronouncements of the President, who is currently enjoying overwhelming support in both houses of Congress, we don’t see any reason why the passage of the comprehensive tax reform measure will not materialize during the early part of his term,” Tugonon said.
“The relaxation of the bank secrecy law as well as the simplification and improvement of the efficiency of our tax system are reforms directed to increase voluntary compliance by taxpayers, increase the tax base and consequently increase tax collection. With the lowering of the income tax rates, which will result in revenue erosion, the need to significantly increase the tax base and improve voluntary compliance cannot be over-emphasized. This is where all of us can help push for tax reform by having a tax-conscious, vigilant and involved mindset,” he added.
