New sin tax law, Citira seen OK’d soon

The Duterte administration expects to shore up spending in the implementation of the universal health care (UHC) law, especially with two tax reform bills expected to be passed within the next two months.

Finance Secretary Carlos Dominguez III on Thursday said a new sin tax law as well as the Corporate Income Tax and Incentives Rationalization Act (Citira), along with the rest of the remaining installments of the comprehensive tax reform package (CTRP), were indispensable elements in bankrolling priority programs such as infrastructure modernization and UHC.

Tax reform, “is necessary to fund social investments such as our new universal health care program, at unprecedented levels for inclusive growth and a more competitive workforce,” Dominguez said in a joint meeting of the Rotary Club of Manila and Makati West.The finance chief said the sin tax bill, to be imposed on alcohol and electronic cigarettes and vaping products, was expected to be signed into law “this month.”

“By March this year, we hope to see the [Citira also] passed into law,” he added.

The Citira, or Package 2 of the CTRP, is intended to lower the corporate income tax from 30 percent to 20 percent over 10 years to bring it closer to the Southeast Asian average while redesigning the current “convoluted fiscal incentives system.”