SEN. Sherwin Gatchalian has urged the Department of Finance (DoF) to study how to protect the jobs of thousands of Filipinos if Congress approves the proposed Corporate Income Tax Incentives Reform Act (Citira).
The senator is apprehensive over the passage of Citira since it will affect the jobs of about 700,000 Filipinos by removing the incentives being enjoyed by many Philippine-based companies and corporations.
He cited a Citira provision, which mandates the compensation of “workers that maybe displaced by rationalization of fiscal incentives to improve employability and so on.”
“Even the bill recognizes job losses. It recognizes displacement,” said Gatchalian, vice chairman of the Senate Committee on Economic Affairs.
“Mahirap ho sa amin suportahan ang isang batas kung alam naming marami ang mawawalan ng trabaho (It’s very difficult for us to support a measure if we know many will lose their jobs),” he said.
American Chamber of Commerce senior adviser John Forbes, who represented the Joint Foreign Chambers of the Philippines during the hearing of Senate Committee on Ways and Means, defended the Philippines’ existing fiscal incentives regime, which he said compensated for the high cost of investing here in the country.
Should Congress pass the Citira, Forbes warned that 121,000 direct jobs and 582,000 in indirect employment would be cut.
On the other hand, retaining the current tax perks would sustain a 5- to 10-percent annual increase in the labor sector, or equivalent to 1 to 2 million direct and 4 to 8 million indirect jobs generated in the next 10 years.
Gatchalian has urged Finance Undersecretary Karl Kendrick Chua to thoroughly study the impact of Citira on the job security of many Filipinos, as well as to conduct a comparative analysis on the costs of producing goods and doing business in our country, among others.
“We are very sensitive to job losses and we are very sensitive to job creation. I think everyone is striving to create jobs,” the senator said.