Metro Manila (CNN Philippines, April 22) — Acting Socioeconomic Planning Secretary Karl Chua on Wednesday said he wants to revisit the country’s tax system to help ease the burden of millions of Filipinos severely affected by the COVID-19 pandemic.
“Ang tax system natin kailangan talagang baguhin kasi maraming problema, kumplikado, hindi patas, at inefficient,” he said during the Laging Handa virtual press briefing aired on state-run PTV.
[Translation: Our tax system really needs to be changed because there are so many problems about it, it’s complicated, unfair, and inefficient.]
Chua said the Department of Finance and the National Economic Development Authority will review economic policies and look into proposals to defer the passage of new tax bills in consideration of the impacts of the virus outbreak.
He said, however, that the comprehensive tax reform program should still push through.
“Ako ay naniniwala na ituloy dapat yung comprehensive tax reform,” Chua said. “Pero siguro dapat may kaunting dagdag or pagbabago para matulungan yung mga naapektuhan ng COVID.”
[Translation: I believe that we should continue the tax reform program. But perhaps there should be additions or modifications to benefit those who were affected by the COVID-19 crisis.]
“Kung hindi po tayo magpapasa ng tax reform, ang ibig sabihin niyan ay sa dami ng dapat tulungan, sa dami ng kailangang serbisyong ibigay, uutang po tayo,” he also said. “Pero hindi po natin mababayaran ngayon sa pamamagitan ng buwis. Iyong mga anak at apo natin yung pagbabayarin natin ng inutang natin, kaya yung desisyon natin whether to borrow money or raise taxes, kailangang pag-aralan kung ano ang balanse.”
[Translation: If we don’t pass tax reform, with so many people in need of assistance and with so many services we need to provide, we’ll have to borrow money. But we cannot pay off our debts with our tax collection. It’s our children and grandchildren who will pay so we need to set a balanced decision on whether to borrow money or raise taxes.]
The Philippine Chamber of Commerce and Industry previously recommended to defer the passage of tax reform measures after the pandemic in order to attract more foreign investments to the country.
President Rodrigo Duterte has certified as urgent the second package of the government’s tax reform–the Corporate Income Tax and Incentives Reform Act. The measure seeks to gradually cut the 30% corporate income tax rate – which is considered the highest in Asia – to 20% by 2029. The bill is still pending in Congress.
Business groups previously urged the Senate to pass the CITIRA bill to attract investments as global trade is affected by the coronavirus outbreak.
