THE Department of Finance (DoF) has once more asked the Senate to prioritize the Corporate Income Tax and Incentives Reform Act (CITIRA) bill just before Congress goes on a seven-week break, to attract more companies seeking a landing spot after exiting China.
The Senate leadership last week signalled that the tax measures will likely take a back seat as the chamber is expecting to prioritize measures that will help contain the spread of coronavirus disease 2019 (Covid-19).
“We are requesting the Senate leadership to consider prioritizing CITIRA,” Finance Secretary Carlos G. Dominguez III told reporters in a Viber messsage Wednesday.
Mr. Dominguez said CITIRA, which will gradually lower corporate income tax to 20% from 30% by 2029 and streamline tax incentives could bring in “higher investments.”
Separately, Finance Undersecretary Karl Kendrick T. Chua said the bill may help attract investors that are exiting China over concerns on its ongoing trade dispute with the US.
“Aside from the Philippines’ talented English-speaking workforce and young robust market, which are the main attractions to investors, a competitive tax incentive system under CITIRA will help draw in investments that are coming out of China as a result of the US-China trade war,” Mr. Chua said in a statement Wednesday.
He said the proposed tax scheme under CITIRA will put the country at par with its neighbors in the Association of Southeast Asian Nations (ASEAN).
“The sooner CITIRA is passed, the sooner these investments will materialize,” he added.
The Senate ways and means committee endorsed its version, Senate Bill No. 1357, to the plenary last month, with its chairman, Senator Pilar Juliana S. Cayetano, expressing the hope that it will be approved on final reading before the March 14-May 3 break.
Earlier, Philippine Economic Zone Authority (PEZA) Director General Charito B. Plaza also asked legislators to halt their discussions on the bill to consider the damage that Covid-19 has done to exporters.
Mr. Dominguez had expressed the hope that the Senate pass its version before the Easter break.
Asked comment, the Senate leadership had not replied at deadline time.
Also before the Senate is the Passive Income and Financial Intermediary Taxation Act bill which aims to simplify the tax structure for financial instruments. — Beatrice M. Laforga