Tax reform to add P268B to state coffers yearly
The Duterte administration’s comprehensive tax reform program is expected to generate P268.3 billion in additional revenue yearly to finance massive infrastructure projects in the pipeline.
In its Fiscal Year 2017 Annual Fiscal Report, the Development Budget Coordination Committee (DBCC) said the annual incremental revenue from the tax reform program would be equivalent to 1.2 percent of gross domestic product.
The additional tax take will push the revenue effort, or share of total revenue to GDP, to 17.6 percent in 2022 from 15.7 percent last year, the DBCC said.
“Tax reform will support the growth of disbursements by an average of 12.3 percent each year to reach 20.6 percent of GDP by 2022, from 17.9 percent of GDP in 2017,” it added.
On top of the first package or the Tax Reform for Acceleration and Inclusion (TRAIN) Act, five more packages are pending in Congress, namely: the Tax Reform for Attracting Better and High-quality Opportunities (Trabaho) Act covering corporate income taxation and fiscal incentives rationalization; package “1B” covering tax amnesty and other tax administration measures; package “2 Plus” proposing higher “sin” taxes, imposing royalty on all mining operations as well as amending the Tax Incentives Management and Transparency Act (Timta Law) to cover all government agencies granting tax exemptions; package three on property taxation; and package four on capital income taxation.
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