The Tax Management Association of the Philippines (TMAP) is pinning its tax reform hopes, particularly with regard to lower income taxes, on the country’s next set of leaders.
“We . . . [have been]pushing this for the past two years and last year we thought we almost had it,” TMAP President Benedict Tugonon told reporters in a roundtable on Thursday
“We really thought we were so near because we had already the support of both houses of Congress,” he added, referring to proposals to lower the top individual tax rate to 30 percent from 32 percent and an all-in tax exemption level of P300,000, among others.
Legislative work in 16th Congress has effectively ended with lawmakers set to take the next three months off to campaign for the May national elections. A brief return to work will cap the third and final session in June.
“We will have to wait for the opening of [the next]Congress this coming July and that time there will already be a new administration, new president,” Tugonon noted.
In 2014, the TMAP formally submitted its comprehensive tax reform proposal to both the Senate and the House of Representatives with the objective of ensuring greater fairness and equity in the tax system, and simplifying the system to enhance compliance, expand the base and increase government revenue collections.
It said the proposals were supported by studies that show the Philippines as effectively having the highest personal and corporate income tax rates in Southeast Asia.
“[W]hile the Philippine economy is one of the fastest growing economies in the world, it could have done better if tax reforms which are stable, easy to understand, convenient to comply [with], [are]growth oriented, developmental and service-written,” Tugonon said.
Taking its cue from the Department of Finance and the Bureau of Internal Revenue, Malacañang repeatedly rejected the passage of a bill mandating adjustments in individual and corporate income-tax rates, saying the government “cannot put our fiscal sustainability and credit rating at risk” given the prospect of lower revenues.