The Philippines’ top entrepreneurs are putting high hopes on the administration’s plan to update the current tax scheme, expressing confidence that the creation and implementation of a better tax program will attract more foreign investors to the country and more Filipinos to explore entrepreneurship.
In a recent meeting with BIR Commissioner Caesar Dulay, the Association of Filipino Franchisers Inc. (AFFI) has lauded the government’s effort in prioritizing the modernization of the two-decade-old tax system.
Tax expert and AFFI Vice President for Government Relations, Raymond Abrea of Center for Strategic Reforms Philippines (CSR Philippines), said this change has been long overdue.
“We’ve been proposing these reforms for the longest time, and we’re really happy to be seeing some action finally happening. We’re still in the very early stages but, at least, we’ve already taken the first steps,” Abrea said.
Government agencies, like the Department of Finance (DoF), Department of Trade and Industry (DTI) Bureau of Customs (BOC), and Bureau of Internal Revenue (BIR) among others, have started working in the past months to prepare for the submission of a comprehensive tax reform package this September. Some of the most notable bits from the plans were the reduction of the corporate and individual income tax rates to 25 percent, tax amnesty, and the implementation of the Tax Incentives and Management Act (TIMTA).
AFFI President Jerry Ilao, for his part, said that the simplification of the tax system, the cutback on income tax, and the purging of graft and corruption in government agencies involved in business processing and management, are keys to persuading more small and medium enterprises (SMEs) to register and comply with BIR regulations.
“SMEs account for about 99 percent of businesses in the country, and that’s a big help in terms of GDP contribution and job creation. But in return, small businesses also need all the help they can get, especially from the government. That’s why we place high hopes in the passing of this tax reform package in the earliest possible time,” said Ilao.
Along with discussing the most pressing concerns of the business community with regards to the current tax scheme, the association has also encouraged BIR Commissioner Dulay to continue ridding the revenue-collecting agency of red tape and corruption as mandated by President Rodrigo Duterte.
“A lot of people have this concept of how businessmen and tax collectors are always at the opposite ends of the spectrum. That should not be the case if we really want inclusive growth for the country. Entrepreneurs and the government should always be willing to work side by side to improve the lives of the people,” stressed Ilao.