FINANCE Secretary Carlos G. Dominguez III believes Filipinos support the tax-reform package, citing the victory of pro-administration lawmakers in the midterm elections.
During the pre-State of the Nation Address (Sona) Economic and Infrastructure Forum on Monday, Dominguez said the victory of politicians who supported the Tax Reform for Acceleration and Inclusion law reflects his confidence the remaining tax packages will be passed.
“The confidence level is very high,” Dominguez said at the Philippine International Convention Center. “You have to remember, the last time the government attempted a tax reform was in 2001, when President [Gloria Macapagal] Arroyo and Ralph G. Recto increased the VAT [value-added tax] rate from 10 to 12 [percent], as a result of that Senator Recto lost the next election, but in this election all those who supported the tax reform won.”
According to the chief of the Department of Finance (DOF), if Filipinos see tax increases benefit them, they will support legislators who made it happen.
“The story here, people see that the tax—whatever tax increases—are being spent for their benefit, it is going to be a plus for the legislator who supported. I’m very confident that given the lessons in this last election, where no one who supported the tax reform lost, will resonate in the minds of the legislators,” he added. “The message of the electorate is that the tax reform is fair and if the money is not stolen and is used for their benefit—infrastructure and education—they will win.”
The remaining tax-reform packages that have yet to be passed into law include: Package 1B, which includes increasing the motor vehicle users charge, lifting of the bank secrecy law and automatic exchange of information; Package 2, which focuses on lowering corporate income tax and the rationalization of fiscal incentives; Package 3, on property valuation; Package 4, on financial taxes; and Package 2 Plus, which includes taxation on alcoholic beverages.
Economic and infrastructure officials emphasized to the investor community and other stakeholders that the critical reforms—both those that were implemented and are still in the pipeline—are meant to push the Philippines toward the next stage of economic development.
Dominguez, who heads the administration’s economic cluster, credits President Duterte’s instrumental role in implementing these tax-reform packages.
The event was one of the three fora meant to report on the government’s accomplishments under the Duterte administration, ahead of the President’s Sona on July 22.
The second forum will be held on July 10 in Cebu City, while the third forum will be held on July 17 in Davao City.