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President Marcos priority tax reform package reaches House plenary

Delon Porcalla - The Philippine Star
This content was originally published by The Philippine Star following its editorial guidelines. Philstar.com hosts its content but has no editorial control over it.
President Marcos priority tax reform package reaches House plenary
President Ferdinand "Bongbong" Marcos Jr. gave a press briefing in Indonesia on September 6, 2022.
The STAR / Alexis Romero

MANILA, Philippines — One of the priority tax reform measures being pushed by President Marcos in his first State of the Nation Address last July 25 has reached the plenary level of the House of Representatives last week.

Albay Rep. Joey Salceda, who chairs the House ways and means committee, delivered his sponsorship speech on the final package of the Comprehensive Tax Reform Program (CTRP) that the Marcos administration inherited from the previous administration and wanted passed.

The CTRP, or House Bill 4339, will simplify the taxation of passive income, financial services and transactions by reducing the number of tax rates from 83 to only 58, according to Salceda.

“If we are able to enact this package as proposed, we will be able to complete the CTRP, one of the largest tax reforms of any country in the world,” he said, noting that this will “significantly simplify tax administration and encourage more financial transactions.”

He added that this program has been a case study for model reforms at Harvard University.

HB 4339 also harmonizes the interest income tax rates and gradually reduces these from 20 to 15 percent. This will benefit a vast majority of Filipinos who have bank savings of less than P15,000, which comprises 79 percent of depositors, according to the Bangko Sentral ng Pilipinas.

The proposal also seeks to remove the documentary stamp tax (DST) on certificates.

Common employment requirements such as the clearance from the National Bureau of Investigation, birth certificates, diplomas and transcript of records will no longer be subject to the DST.

Meanwhile, Negros Oriental Rep. Arnolfo Teves Jr. has filed HB 4528 that aims to amend the charter of the Philippine Charity Sweepstakes Office (PCSO) by reverting it to its previous mandate as a purely charitable institution.

Teves made the move even as there has been an increase in sweepstakes ticket sales, citing as instance that the “growing number of requests for greater financial assistance all over the country has been outstripping PCSO earnings.”

The senior Visayan administration lawmaker wants the PCSO to be “exempt from taxation as well as payment of DST.”

“This bill seeks to amend the PCSO charter reverting to its original mandate operating as a charitable institution and concentrate on the implementation of medical health programs and all other activities and programs be removed,” he said.

Teves used as example former PCSO vice president and general manager Royina Garma’s 2018 case, where the revenue-generating agency paid P16.7 billion in taxes while P33.6 billion of its revenues went to prizes.

“This amount could have been used directly to help our less privileged brothers and sisters with their medical needs,” he said.

As it turned out, only P9 billion was left to fund various PCSO charity programs.

As embodied in its charter, the PCSO’s primary objective is to provide funds for health programs, medical assistance and services and charities of national character.

Its mandate sets the pace for the development of community health care in all regional hospitals nationwide through the establishment of tuberculosis centers, cancer and pain centers, and dialysis centers that deliver vital medical assistance and services to people.

PRESIDENT MARCOS

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