SEC backs bill lowering taxes on stock transactions

The Securities and Exchange Commission (SEC) is backing the passage into law of a measure that aims to lower taxes on stock transactions as it is seen to boost and improve the competitiveness of the Philippine capital market.

In a statement on Tuesday, the SEC said it supports the House Bill No. 8958, or the proposed Capital Markets Efficiency Promotion Act filed by Albay 2nd District Representative Jose Ma. Clemente “Joey” Salceda.

The proposed measure seeks to bring the stock transaction tax (STT) down to 0.1% of the stock value from the current rate of 0.6%.

The tax on dividends of foreign non-residents will likewise be reduced to 10% from 25%.

The SEC said the bill has since undergone deliberations at the committee level and has been substituted by House Bill No. 9277, filed on September 21.

“The SEC welcomes the efforts of our legislators to boost the capital market, as this recognizes the contribution and potential of the financial sector to help in the development of the Philippine economy, toward easing and improving the lives of all Filipinos,” said SEC chairperson Emilio Aquino.

“We will work closely with our lawmakers to ensure that new laws and policies will be reflective of the needs and demands of the market and investors, while still balancing the Commission’s role as regulator,” added Aquino.

To attract more investors into the country’s capital market, the SEC said it shortened the settlement cycle from three days to two days after the trade date by amending the 2015 Implementing Rules and Regulations of Republic Act No. 8799, or the Securities Regulation Code, through SEC Memorandum Circular No. 11, Series of 2023.

The corporate regulator added that funding portals have also been empowered to act as registrars of qualified institutional and individual buyers, which eliminates the need for these portals to use third party institutions to assist potential investors with their applications as qualified buyers. — Ted Cordero/RSJ, GMA Integrated News