MANILA, Philippines – The Aquino administration is confident that it would get the support of lawmakers for the approval of 2 crucial revenue bills before Congress adjourns on June 30.
The bills are the sin tax measure which calls, among other things, for the indexation of taxes for tobacco and alcohol to inflation, as well as a bill that would rationalize fiscal incentives given to local and foreign investors.
Budget and Management Secretary Florencio Abad said the administration is confident it has the “numbers in Congress” to get the measures passed. He explained that lawmakers are beginning to realize that their respective districts would get a share in additional revenues from the proposed taxes.
The sin tax measure, contained in House Bill 5757, is authored by Cavite Rep Joseph Emilio Abaya.
Currently pending at the House Ways and Means Committee, it also calls for the adoption of a unitary tax system for tobacco and liquor.
The measure is estimated to yield an additional P60-B in fresh revenues from cigarettes and tobacco products.
“A good chunk of the P60 billion will go to public health investments. So practically, all of those districts will go to public health investments. This means all of those districts will be befitted by the rehabilitation of their hospitals, construction of new health facilities and coverage of more Philhealth beneficiaries,” Abad said.
Apart from the sin tax bill, the finance department and the Department of Trade and Industry have also been pushing for a fiscal incentives bill.
Abad said this would “strike a balance between the country’s need to attract investments but at the same time minimizing the agency’s revenue losses.”
The government wants to stop giving income tax holiday to investors, saying such tax perks affect revenues.
Apart from boosting the state’s coffers, the proposed revenue bills – if passed – are also expected to increase the country’s chances of getting the much-sought after credit ratings upgrade. – Rappler.com