Diokno wants tax on single-use plastics, online transactions
President Ferdinand Marcos Jr.’s chief economic manager, Finance Secretary Benjamin Diokno, is looking into recommending the passage of legislation to tax single-use plastics and digital transactions.
“We are thinking of some possible tax on single-use plastics as this is part of our commitment to [address] climate change,” Diokno said at a press conference after the Development Budget and Coordination Committee’s (DBCC) meeting on Friday.
As part of efforts to curtail the effects of climate change, the Philippines joined nearly 200 countries in a landmark deal in Paris in December 2015 to cut greenhouse gas emissions to limit the rise in global temperatures to below two degrees Celsius.
However, the Philippines is one of the top plastic polluters in the world, according to the United Nations Environment Programme (UNEP) 2018 report.
Aware of the Philippines' reputation as one of the world's biggest plastic polluters, Marcos vowed in his inaugural address on June 30 that "we will clean up."
Diokno has been vocal in proposing the imposition of “correct” taxes on streaming service payments and other digital transactions as a way for the government to earn additional revenues.
“In response to recent developments and on the basis of fairness, we intend to tax online purchases because if you buy a product from a regular store, you pay tax, and I think we should also pay tax [on] online sales,” he said.
Former Finance chief Carlos Dominguez III previously unveiled a fiscal consolidation plan aimed at raising an average of P284 billion annually for the next 10 years to pay off the historic P3.2 trillion additional debt incurred due to the COVID-19 pandemic.
The fiscal consolidation plan involves implementing new taxes, deferring personal income tax reductions, and expanding the value added tax base.
Diokno said that he is fine with the last two tax reform packages to be left by the Duterte administration, namely, the tax packages on real property valuation and passive income and financial taxes.
At the press briefing, the Finance chief reiterated that the Marcos administration intends to use the two remaining packages of the previous government’s Comprehensive Tax Reform Program (CTRP).
“There are two remaining packages out of that tax reform program. That’s packages 3 and 4. We intend to pursue packages 3 and 4. They are supposed to be revenue neutral, but they will significantly improve or simplify the tax system. So we are pushing for those,” Diokno said.
Package 3 of the CTRP or Real Property Valuation Reform "aims to promote the development of a just, equitable, and efficient real property valuation system," according to the Department of Finance.
It is seen to “broaden the tax base used for property and property-related taxes of the national and local governments, improving tax collections without increasing the existing tax rates or imposing new taxes," the agency said.
Package 4 or the Passive Income and Financial Intermediary Taxation is seen to “greatly simplify the taxation of passive income, financial services, and transactions," the DOF said.
This package “will also harmonize the tax rates on interest, dividends, and capital gains, and the business taxes imposed on financial intermediaries and will likewise remove the documentary stamp tax (DST) imposed on nonmonetary transactions," it added. —VBL, GMA News