Several senators on Tuesday expressed reservations on approving the Corporate Income Tax and Incentives Reform Act (CITIRA) amid the COVID-19 pandemic.
Senator Sonny Angara, chair of the finance committee, said the bill has to be weighed carefully and that economic policies of the neighboring countries shall also be observed.
"We need to tread carefully given the drastically different economic environment. First rule is probably to not lose any of the present investors we already have since the investment outlook doesn’t look fantastic going forward," Angara said in a text message.
"Consumer behavior may change also, going forward. But in general, it is good to settle the uncertainty over the incentives debate in the near future," he added.
Senator Imee Marcos, chair of the committee on economic affairs, also said she has misgivings about CITIRA which aims to "rationalize" the incentives given to domestic and resident foreign corporations.
"Medyo kabado ako dito sa CITIRA na papasok dahil mayroon diyan na babawasan at tatanggalan na naman ng tax incentives ang mga investor," Marcos said during the Laging Handa press briefing.
"Dapat balansehin nang maigi... At this point in time kung magdadagdag ka ng buwis, parang wala naman sa tono. Hirap na hirap na ang mga korporasyon," she added.
Marcos, nonetheless, said she is amenable on the provision of the bill which seeks to gradually reduce the corporate income tax rate in the country from 30% to 20% by 2029.
Senator Grace Poe likewise said the proposed measure may make it difficult for the Philippines to catch the post-pandemic investments.
"With CITIRA, we are actually digging out the benefits or the exemptions or incentives for these companies, 'yung mga BPO or doon sa mga PEZA zones. It will be hard for us to catch those investments," Poe said in a virtual interview.
"Kaya parang sa ngayon baka medyo wrong timing pa ito," she added.
Earlier in the day, Finance Secretary Carlos Dominguez III requested the Senate approval of the corporate tax reform bill which has been certified urgent by President Rodrigo Duterte last March.
Senate President Vicente Sotto III said the chamber will give its best effort to pass the measure before the sine die adjournment of session on June 3.
It will be a "different" CITIRA, according to Senate President Pro Tempore Ralph Recto.
Senate Minority Leader Franklin Drilon, though expressing support for the proposed measure "in general," said the timing of its passage would still be open to debate of the lawmakers.
"The senators, I believe, are divided on this issue. Moreover, the Senate only has 6 session days to debate, amend, pass and do the bicam. Is there enough time?"' he said.
Senator Pia Cayetano, who chairs the Senate ways and means committee, earlier said that CITIRA can be used to bolster targeted investments that are most needed in the Philippines amid the health crisis. — RSJ, GMA News