As President Rodrigo Duterte delivers his final State-of-the-Nation Address (SONA) on July 26, the chairman of the House Ways and Means Committee expects the President to reiterate the urgency of passing the rest of the Comprehensive Tax Reform Program.
Albay Representative Joey Salceda said the passage of the proposed Real Property Valuation and Assessment Reform Act and the proposed Passive Income and Financial Intermediaries Taxation Act (PIFITA) would be a net plus for the country’s credit rating.
Both reforms are currently pending before the Senate.
He said Duterte would also emphasize the need to create new revenue streams during his final SONA.
“Some weeks ago, he mentioned the strategic importance of a well-regulated gaming sector to economic and fiscal recovery,” Salceda said.
Salceda noted that the House and Senate would agree on a ratified version of the tax regime on Philippine Offshore Gaming Operations (POGO) a week after SONA.
Another potent revenue stream, he said is e-sabong taxes, which the House has already submitted to the Senate.
He stressed that the approval of the amendments to the Foreign Investments Act, the Public Service Act, and the Retail Trade Liberalization Act (RTLA) will be “critical” to increasing foreign direct investments and creating new jobs.
The RTLA is now at the bicameral conference stage, while the other two are on the Senate floor.
He also highlighted the need to make the Corporate Recovery and Tax Incentives for Enterprises (CREATE) law work, as it could open the doors to greater foreign investments.
“The net inflow of foreign direct investments (FDIs) more than doubled to $679 million in April from $317 million in 2020. But, to maximize its impacts, we need a well-trained and well-equipped labor force capable of filling in the jobs FDIs will create,” he said.
He said a stronger role for the Technical Education and Skills Development Authority (TESDA) is necessary to establish a skills-centric education system.
“I am hoping President Duterte will reiterate the need to transform TESDA into a cabinet-level agency capable of implementing a massive national upskilling program. Along with this, I hope President Duterte also emphasizes the need for a skills-centric education system,” he said.
If Congress were to legislate the rest of Duterte’s fiscal and economic reforms, he said the 2022 national budget must be enacted early.
He also noted that the Development Budget Coordinating Committee would be meeting on Monday, and it would reconsider their earlier reservations on a third stimulus package.
“In any case, we need some form of stimulus as vaccination picks up. Stimulus packages work best when demand begins to normalize because they create momentum. The figure in consideration is $173 billion or whereabouts. We will keep a close eye on these discussions,” he said.
He said the House Ways and Means Committee has a host of other measures lined up, including a Fiscal Regime for Mining, Ease of Paying Taxes Act, the Motor Vehicle Road Users’ Tax, and the Excise Tax on Single-Use Plastics.
“Although this is President Duterte’s last SONA, the Committee remains focused on enacting as many of these pending reforms as possible. The tone of President Duterte’s SONA, especially in our current socio-economic context, will also likely zero in on the work that still needs to be done,” he said.