House approves 2nd tax reform package on final reading

The House of Representatives on Monday approved on third and final reading the measure providing for the second package of the government's tax reform program.

With a vote of 187 in the affirmative, 14 negative and three abstentions, the chamber approved House Bill 8083, now known as the Tax Reform for Attracting Better and High-quality Opportunities (TRABAHO) bill.

Under the proposed measure, the government will lower the corporate income tax from 30 percent to 25 percent over 10 years and rationalize fiscal incentives.

Once the new tax investment scheme takes effect, an investor will likewise be able to have a tax holiday of five to seven years, but this will depend on the location and merits of the investment.

Apart from this, investments in certain industries, like infrastructure and research development, may also enjoy additional tax cuts.

Speaker Gloria Macapagal Arroyo herself earlier said that the TRABAHO bill is a priority of the House of Representatives under her leadership.

The first package of the tax reform program, which was enacted in December last year, reduced personal income tax rates and at the same time increased excise taxes for petroleum products, automobiles, and imposed levy on sugar sweetened beverages.

The first package of the tax reform program, known as the Tax Reform for Acceleration and Inclusion (TRAIN) Law enacted in December last year, reduced personal income tax rates and at the same time increased excise taxes for petroleum products, automobiles, and imposed levy on sugar sweetened beverages.

However, it is being blamed by opposition lawmakers for the rising of prices of basic commodities and the continuously accelerating inflation in the country.

Those who voted against the approval of the bill are:

• Magdalo party-list Rep. Gary Alejano
• BUHAY party-list Rep. Lito Atienza
• Quezon City 3rd District Rep. Jorge “Bolet” Banal
• Quezon City 6th District Rep. Jose Christopher “Kit” Belmonte
• Camarines Rep. Gabriel Bordado Jr.
• Gabriela Women’s Party Rep. Arlene Brosas
• Anakpawis party-list Rep. Ariel Casilao
• ACT Teachers party-list Rep. France Castro
• Northern Samar Rep. Raul Daza
• Kabataan party-list Rep. Sarah Elago
• Albay Rep. Edcel Lagman
• Marikina City Rep. Miro Quimbo
• Akbayan party-list Rep. Tom Villarin
• Bayan Muna party-list Rep. Carlos Zarate

Ifugao Representative Teddy Baguilat, Negros Oriental Representative Arnulfo Teves Jr., and Bukidnon Representative Manuel Zubiri abstained.

In voting against the approval of the bill, Zarate said the second package of the tax reform program is "anti-poor" and "pro-rich."

"Ngayon ay nais nating bawasan ang corporate income tax mula sa kita sa panghuhuthot ng TRAIN 1 sa ordinaryong mamamayan. Nasaan ang 'progressive taxation' rito?" he said.

"Ang totoo, ang TRAIN Package 1 at 2, pati na ang iba pang pahabol na TRAIN 1B, ay mga panukalang nais lamang pigain pa ang mamamayan, at maligtas sa pagbabayad ng buwis ang mayayaman," he added.

For her part, Brosas said there is no point in approving TRABAHO bill which is anchored on TRAIN 1.

"This measure will disproportionately benefit big foreign and local corporations with the reduction of the corporation income taxes," she said.

"Habang nagdurusa ang mga ordinaryong pamilya sa hambalos ng taas-presyo, lalong lalaki pa ang paggastos sa luho ng pinakamayayamang negosyante sa bansa dahil babawasan pa lalo ng TRAIN 2 ang buwis sa bilyun-bilyong tubo ng mga korporasyon nila," she added. —JST, GMA News