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Sonny Angara questions speedy passage of TRAIN 2 in House: Napag-aralan ba ‘yan?

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Senator Sonny Angara wondered why the House of Representatives passed the Tax Reform for Attracting Better and High Quality Opportunities (TRABAHO) bill without a study on its impact on jobs.

Angara, chairman of the Senate Committee on Ways and Means, on Tuesday conducted the first public hearing on TRABAHO bill House Bill 8083.

The TRABAHO Bill is actually the package 2 of the Tax Reform Acceleration and Inclusion (TRAIN) law which aims to rationalize corporate taxes.

He said that the ways and means panel would not proceed with its deliberation of the TRABAHO bill unless the government can present definitive data on the impact on jobs.

During Tuesday’s hearing, Finance Undersecretary Karl Chua insisted that more jobs will be created in the long run under the TRABAHO bill.

However, Labor Department Director Dominique Tutay admitted that the measure which seeks to lower corporate income tax while cutting cut incentives, might lead to “job losses.”

Tutay said the Department of Labor (DoLE) and the Department of Finance (DoF) “have yet to complete their joint study on the impact on jobs of TRABAHO bill.”

The DoLE said it would be able to complete its study on the impact on jobs in two weeks

“I’m surprised that the Lower House passed this measure even without such study. The government should really take this issue on jobs seriously,” Angara said.

“Milyon-milyong trabaho at kabuhayan ng milyon-milyong pamilya ang nakasalalay dito,” the senator from Baler, Aurora said.

Angara added, “The bill should stay true to its name—that it would create more jobs rather than kill them.”

He also expected the National Economic and Development Authority (NEDA) to present its cost-benefit analysis of the incentives before the committee. But no representative from NEDA was present during the hearing.

DoLE revealed that based on their job displacement monitoring, 30,000 jobs in the industry and services sectors were lost in the first quarter of 2018.

Following the passage of HB 8083, the Semiconductor and Electronics Industries in the Philippines Foundation Inc. (SEIPI) has released a statement that the bill would force them to lay off 140,000 workers.

They said several multinationals are now locating their expansions outside the country, largely due to the uncertainty of keeping their tax incentives here.

HB 8083 provides for P500 million to be used for cash grants for displaced workers. An additional P500 million would be allocated for targeted trainings and skills upgrading.

Chua explained that these are just “contingency funds for possible job losses.”

Based on data from the DoF, a total of 1.7 million direct and 7 million indirect jobs were generated by companies registered with investment promotion agencies (IPAs).

Angara has stressed that the primary goal should be to create high-paying jobs especially in the countryside.

“It seems that the grant of incentives is uneven across regions. We want to spread growth and development in the provinces,” he said.

“Ang hangarin po natin ay lumikha ng trabaho sa rural areas para tulungan silang umangat sa kahirapan,” he said.