Gov’t hopeful on passage of 3 tax packages this year

Three more packages of the Duterte administration’s comprehensive tax reform program are expected to be approved within this year, including the Corporate Income Tax and Incentives Rationalization Act (Citira), the committee report of which will be presented by

the Senate ways and means next week.

“I think we are progressing well in the Senate for the last three major packages,” was Finance Undersecretary Karl Kendrick Chua’s response when asked if it was possible for all pending packages to be signed into law within the 15- to 18-month timeline since the start of the 18th Congress that Finance Secretary Carlos Dominguez III wanted them passed.

Already approved by the Lower House but still pending in the Senate are Citira, the Passive Income and Financial Intermediary Taxation Act and land valuation reform.

Also part of the comprehensive tax reform program are the planned general tax amnesty, which must include the lifting of bank secrecy for tax purposes and automatic exchange of information, as well as higher mining taxes and motor vehicle users’ tax.

Chua said he was optimistic even with the Citira, which some senators have been opposing due to fears of job losses when some investors pull out due to fewer tax incentives, after Senate ways and means committee chair Sen. Pia Cayetano said she was ready to sponsor the bill’s committee report next week.

Citira is aimed at gradually reducing the corporate income tax rate from 30 percent at present (the highest in Asean) to 20 percent over a 10-year period, while rationalizing the fiscal perks for that bring about foregone government revenues. Cayetano said the committee report would address concerns that had been put forward by various industries to be affected by the change in the tax incentives regime.

“The priority is Citira, so a lot of businessmen, I believe, will have peace of mind, which Finance Secretary Dominguez has been assuring them of. We will set the standard in very clear terms so that there is no room for second guessing what is the future going to be like in three, four or five years. That is the objective—no guessing game.”