Foreign biz chambers: Speed up CIT reduction
Credit to Author: ANNA LEAH E. GONZALES| Date: Wed, 26 Jun 2019 16:26:05 +0000
TWO foreign business groups have urged the government for a quicker reduction of the corporate income tax (CIT) rate under House Bill 8083 or the Tax Reform for Attracting Better and Higher-quality Opportunities (Trabaho) measure.
In a recent interview, German-Philippine Chamber of Commerce and Industry (GPCCI) Executive Director Martin Henkelmann said Trabaho was “one of the bills that need focus,” and “it should be clear how they (lawmakers) would [address] the question of incentives.”
“I think there are very positive developments in the bill, such as reducing the corporate tax. However, we are worried that it is not going fast enough,” he added. “We hope they would reduce the corporate tax faster….”
One of the proposed packages of the government’s Comprehensive Tax Reform Program, Trabaho seeks to reduce corporate income tax from the current 30 percent to 20 percent in 10 years, and rationalize the fiscals incentives that businesses currently enjoy.
Henkelmann also said it was “very important” to have “a competitive regime and rules setup for the incentives,” and “take into account the companies that have been here” and convince them to “invest more.”
“It is important to take care of their concerns, as well,” he added.
For her part, Barbara Apraiz, executive director of the Spanish Chamber of Commerce in the Philippines, proposed that instead of 10 years, the tax should be lowered to 20 percent in five years.
“If we want to increase the trabaho (work) of the population, 10 years is just too long. We need to be competitive with other countries. [It] could be five years. That [would] be really good [in order to] be competitive with other countries” in the region, she said.
She clarified, however, that the rationalization of incentives was not a cause for concern for Spanish companies, which she said were taking advantage of the government’s ambitious Build Build Build infrastructure program.
“[T]here are a lot of Spanish companies coming [to the country] to do their railways…. [S]ome of them [are] also [here] for [airport projects]. This is going faster, and we hope it would be much faster. I think this really is a good time for the Philippines,” Apraiz added.
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