Senate President Koko Pimentel III on Thursday said that the Senate would prioritize deliberations of the President’s comprehensive tax reform package when sessions resume on July 24, given the importance of the measure vis-a-vis the government’s infrastructure and economic development plans.
“The Senate is well aware of the significance of these tax reform measures and the role these will play to generate the revenue we need to fund the government’s massive infrastructure development plan,” said Pimentel, who said that senators would be working with the country’s economic managers to pass a tax reform package that is “fair, equitable, and beneficial to all.”
Approved by the House of Representatives before it adjourned, the Tax Reform for Acceleration and Inclusion (TRAIN) bill lowers the tax rate for fixed-income earners, no longer imposes taxes on personal incomes of not over 250,000 pesos, and pegs the tax exemption threshold for bonuses and benefits at 100,000 pesos.
The tax measure also levies excise taxes on petroleum products, with a 7-peso tax on leaded and unleaded premium gasoline, a 3-peso tax for kerosene; a 3-peso tax for diesel fuel oil; a 3-peso tax for liquefied petroleum gas; and a 3-peso tax per kilogram of asphalts, among others. It also imposes additional taxes on the purchase of motor vehicles and sugar-sweetened beverages.
The passage of the measure has already been welcomed positively by the markets and credit ratings agencies like Moody’s.
The tax reform’s approval on June 1 lifted the Philippine Stock Exchange index (PSEi) to its highest finish in nearly 10 months at 8,001.38.
According to Pimentel, he agreed with Socioeconomic Planning Secretary Ernesto Pernia, who ealier said that “the hallmark of Dutertenomics is regional and rural development that will reduce inequality and poverty across regions and households.”
The government is planning to spend more than 8 trillion pesos for various infrastructure projects to usher in what it calls the “Golden Age of Infrastructure.” It is also committed to invest in human capital and social protections for the country’s most vulnerable sectors.
Pimentel pointed out that the infrastructure investments that will be made in Mindanao––which will benefit from new railways, roads, and bridges––will spur investment in the region and generate jobs and economic opportunities where they are needed most.
“As the first Chief Executive from Mindanao, President Duterte knows firsthand that development is needed in the regions farthest from the national capital,” said the senator from Mindanao.
“But before we can build, build, build, we have to invest, invest, invest––and this is the purpose of these tax reform packages we in the Legislature will tackle. I believe that at the end of the day, all senators regardless of political affiliation will be united behind these efforts to reform, update, and improve our tax system.”