Metro Manila (CNN Philippines, February 3) – President Ferdinand Marcos Jr.’s administration should uphold its “no tax exemption” policy for the proposed corporation that will manage the Maharlika Investment Fund (MIF), Senator Chiz Escudero said.
The senator said that granting too much tax exemptions to the Maharlika Investment Corporation (MIC) is a “bad policy.”
“It is bad policy to have a lot of exemptions and very difficult to implement, if at all,” Escudero said in a statement released on Friday.
“So, I think they should continue with that policy,” he added. “The policy of the previous administration was not to provide tax exemption, or at the very least minimize it.”
READ: Escudero questions composition of Maharlika fund board
Article 7, Section 31 of Senate Bill 1670 and House Bill 6608 states that MIC and MIF shall be exempt from local and national taxes, direct and indirect, that may be imposed under the Local Government Code of 1991, and the National Internal Revenue Code of 1997.
But Escudero said MIC should still be obligated to pay the taxes due as the government can always funnel the money back to the Maharlika Fund by way of the Tax Expenditure Fund as provided for in the annual General Appropriations Act
The lawmaker added that financial institutions such as Land Bank of the Philippines and Development Bank of the Philippines – which are being eyed as major contributors to the MIF – have been paying taxes as the rest of the other corporations.
“The Land Bank and the DBP do not enjoy (tax) exemptions. So, why give it to the MIC?” he asked.
READ: The proposed Maharlika Investment Fund: What you need to know
The Maharlika fund is a sovereign wealth fund that will be used by the government to invest in key sectors like foreign currencies, domestic and foreign corporate bonds, commercial real estate, and infrastructure projects — to help fund the country’s priority programs.
The House of Representatives approved its version of the MIF in December 2022.
