THE Department of Finance’s (DOF) proposed comprehensive tax reform program, which is meant to carry out President Duterte’s 10-point agenda to sustain inclusive economic growth, has received enthusiastic support from an economic expert in the House of Representatives.
Former Albay governor and now Rep. Joey Salceda said Tuesday the DOF’s current plan was much better than the one presented by the previous administration and vowed to give it his full backing.
“Sir, you have my ardent support, and I’m sure my chairman will have the same . . . I would like to congratulate you for your latest tax reform measure. It’s a very good measure,” Salceda told Finance Secretary Carlos Dominguez 3rd during the organizational meeting held by the Ways and Means Committee of the House of Representatives to discuss the DOF’s proposed tax reform program.
The committee is chaired by Rep. Dakila Carlo Cua while Salceda is senior vice chairman.
Dominguez thanked Salceda for his support, saying that it was “very heartening” coming from the congressman, who is considered an expert in the field of economics.
Salceda had previously served as Albay representative in the 11th Congress as chairman of the Committees on Trade and Industry and vice chairman of the Ways and Means and Economic Affairs committees.
A former foreign fund manager and economic analyst acknowledged by his peers as an expert in these fields, Salceda was also the principal author of several key measures in the House that were designed to protect domestic farmers from the negative effects of the Philippines’ membership in the World Trade Organization.
Salceda suggested renaming the DOF’s tax reform plan into “Fiscal Roadmap to Acceleration and Inclusion.” He said this would highlight its primary goal of raising revenues for the government’s accelerated spending program on infrastructure, human capital and social protection while reducing income tax rates to put more money in the pockets of wage-earners and thereby further stimulate economic growth.
At the same briefing, Dominguez told the legislators that the DOF has “put the packages together so that there will be a balance between revenue-eroding measures and revenue-enhancing measures.”
Dominguez told the House panel that the final tax reform plan that will be presented to Congress this month will “comprise four packages. Each of the packages will correspond to a bill that balances policy trade-offs. Other packages may be considered as needed.”
“Today, the Philippines has among the highest tax rates in the region and among, as I said earlier, the narrowest tax bases,” he said. “Our goal is to correct this inequity and the resulting distortions by moving to a low tax rate, broad-based tax regime.”
“We will lower personal income tax rates towards the regional average, so that the middle- and lower-income classes will have more money in their pockets, while expanding the base consumption taxes by limiting VAT exemptions to only raw food, health and education,” he said.