BSP chief bats for simpler tax on stocks, bonds

MANILA, Philippines — Bangko Sentral ng Pilipinas (BSP) Governor Eli Remolona is pushing for legislative reforms that will boost the Philippine equities and bond markets.

In particular, he hopes that taxation on the different financial instruments will be simplified.

“As you know, now it’s complicated. When you invest in different financial instruments, there are different tax rules,” Remolino said in a virtual interview with Businessworld.

At present, he said the Philippine equities and bonds markets are not in global indexes because of these complications in taxes.

Legislative reforms can harmonize the different taxes slapped on the different financial instruments available to investors, he said.

Remolona said it would be good to be part of global indexes because it would attract more investments into the country.

“It would be nice to be part of a stock market global index,” he said. “The way most people invest these days is by investing in an index. Those are the kinds of investments that we want because those are the kinds of investments that stay rather than flee at the first sign of trouble.”

As head of the Anti-Money Laundering Council, Remolona is also pushing for amendments to the Bank Secrecy Law to be able to open the accounts of those involved in investment scams and phising activities.

The Securities and Exchange Commission (SEC), also a member of the council, has been cracking down on individuals and entities that offer securities to the public without the proper license.

The Philippine Stock Exchange (PSE) has also been stepping up efforts to attract investors in the market, including retail investors.

Both the PSE and the SEC have been urging the public to invest in the capital markets instead of choosing get-rich-quick schemes that may turn out to be investment scams.

Data from the PSE showed that the number of online stock market accounts rose by 8.6 percent in 2022 to 1,258,907 accounts.

Despite the muted growth in online accounts compared to previous years, the average value per online transaction rose by 33.2 percent to P46,236.40 from P34,701.80 in 2021.

While close to 100,000 online accounts were added last year, its non-online counterpart recorded a decrease of 7,156 accounts to 453,827, latest data from the PSE showed.

“Given this, the total stock market accounts registered in 2022 was at 1,712,734, up by 5.7 percent from 2021’s 1,620,017 accounts,” the PSE said.