House OKs Trabaho bill on second reading
By JOHN CARLO M. CAHINHINAN
Legislators on Tuesday (September 4) approved in second reading House Bill 8083, or the proposed Tax Reform for Attracting Better and High-quality Opportunities (TRABAHO) Bill.
During Tuesday’s proceedings in the House Plenary approved the measure through a viva voce voting.
The House leadership under former President and now Speaker Gloria Macapagal Arroyo was present during the voting procedure.
The TRABAHO Bill seeks to reduce corporate income taxes starting.
Under the proposed legislation, the rate of corporate income tax will be reduced gradually from 30 percent to 20 percent between year 2021 and 2029.
Quirino Rep. Dakila Carlo Cua said the Philippine corporate income tax rate of 30 percent was one of the highest in Southeast Asia (SEA) and prevents the country from attracting much-needed foreign investment.
The government hopes to make the country more competitive by gradually lowering the rate from 30 percent to the current SEA median of 20 percent.
Cua, chair of the House ways and means panel, said the measure would not burden consumers as it would not impose any additional taxes on consumer product
“Wala siyang bagong buwis. Ibang iba ito. Ang ginagawa ng TRABAHO bill ay scheduling the gradual reduction of our corporate income tax,” said Cua.
He added that the measure would not lead to a mass lay-off despite warning he Philippine Ecozones Association due to the alleged removal of tax incentives for investors.
The ways and means chair said the TRABAHO bill instead would modernize the country’s tax incentives regime to ensure it is “targeted, time-bound, and effective.”
“Kasi gusto nga natin nabibigyan ng incentives ‘yung mga tamang industriya at mga tamang kumpanya,” Cua said.
Cua also clarified that the bill does not eliminate tax incentives since under the new tax incentive schemes, an investor can enjoy a tax holiday of five to seven years depending on the location and merits of their investment.
The incentive package can also be renewed after it expires especially if the business is expanded or creates more jobs. The government also seeks to “incentivize certain investments by rewarding additional tax deductions.”
“Gusto natin ang investor mamuhunan sa larangan ng infrastructure, ng research and development, sa pagpapasweldo ng mga tauhan nila at hindi sa pagtitipid ng sweldo ng tauhan nila,” said Cua.
“We want better lives for the people and we are targeting the incentives package exactly to behaviors that we want to encourage on the part of the investors,” Cua added.