Filtered By: Money

DOF submits more tax reform proposals to Congress

The Department of Finance (DOF) on Sunday said it has submitted to Congress the remaining packages of the administration's planned Comprehensive Tax Reform Program (CTRP).

"All remaining CTRP packages were, as earlier committed by DOF officials, submitted before end-July to the House of Representatives, from where all taxation measures emanate under the bicameral Congress," the DOF said in an emailed statement.

The first package, the Tax Reform for Acceleration and Inclusion (TRAIN) Act, was passed into law by President Rodrigo Duterte in December.

TRAIN effectively expanded the value-added tax (VAT) base and reduced personal income taxes (PIT) starting January.

TRAIN1B, which contains the proposed tax amnesty program and adjustments in the Motor vehicle Users Charge (MVUC), is also pending before Congress.

Meanwhile, Package 2 or the Tax Reform for Attracting Better and High-quality Opportunities (TRABAHO) has already been approved by the House Committee on Ways and Means.

It aims to lower the corporate income tax (CIT) rate, and broaden the tax base by modernizing investment tax incentives. Submitted by the DOF to Congress in January, TRABAHO seeks to plug leakages such as tax holidays and no time limits which costs the government over P300 billion yearly in foregone revenues.

"With the unequivocal support from the President, Finance Secretary Carlos Dominguez III said he is hoping the Congress could pass Package 2 and the rest of the CTRP packages before the end of 2018, especially because lawmakers would, at the onset of 2019, be already preoccupied with their respective campaigns for next year’s midterm elections," the DOF said.

The three additional packages submitted to Congress include the following:

  • Package 2+: Proposal to increase the excise tax on tobacco and alcohol products and increase the government's share from mining;
  • Package 3: Proposal to reform property taxation to make the valuation system "more equitable, efficient, and transparent"; and
  • Package 4: Proposal to rationalize capital income taxation to address the multiple rates and different tax treatments and exemptions on capital income and other financial instruments.

— BM, GMA News