Influx of investments that will result in massive generation of taxes are the crucial factors that will determine the survival and subsequent recovery of the Philippine economy post-pandemic, according to Makati Business Club (MBC) Chairman Edgar O. Chua.
During the online business forum organized by Stratbase Albert del Rosario Institute, he emphasized that businesses must be able to address the multiple needs of Filipino consumers – and these would cut across food, water, housing, power, telecommunications, transport, education, healthcare and other services as well as banking and finance, so the country’s economy could get back to rebound phase.
Then from the provision of these critical commodities and services to the Filipino end-users, these will not only generate jobs but will also yield taxes for the State coffers.
“Business makes money from these, but they are essential to national development, to improve standards of living,” Chua opined.
He added that the wealth of the State that it utilizes in addressing the needs of the Filipinos are all coming from taxes – both the direct and indirect taxes being paid for by businesses and individuals.
“Direct taxes, meaning our corporate income tax and other taxes we pay ourselves. Indirect, meaning, taxes that are paid for by our employees or by our suppliers. We may not often think of it, but practically all government revenues come from taxes on business activity or from workers we employ. These taxes pay for practically everything the government provides and that we benefit from,” Chua explained.
On the sphere of job creation, he noted that 90-percent are concretized in the fold of private sector businesses; while the balance of 10-percent of employments are provided by government institutions or entities.
Yet for businesses to thrive, the MBC chairman stated that “the government should provide the enabling environment and the needed regulation to ensure laws and contracts are obeyed – both those that restrict businesses and those that protect them.”
Chua similarly highlighted the need for caution, with him emphasizing that “we also need to weigh in on the capacity of our partner-stakeholders to provide such measures in the short-term and long-term, otherwise, we could see our economy collapsing.”
Businessman Benedicto V. Yujuico, president of the Philippine Chamber of Commerce and Industry (PCCI), similarly indicated that in bringing the country into the recovery pathway, the government cannot do everything on its own.
Instead, he stressed that “it needs active support from all stakeholders of society to be able to effectively nurse our economy back to health,” and such must be executed with the highest form of solidarity, or what is known in the Filipino psyche as the “Bayanihan” approach.
Yujuico sounded off that “as an organization that represents small, medium and large enterprises in different sectors, PCCI fully understands that we cannot simply ask for fiscal relief to help our smaller members cope and survive.”
He lamented that “the key issues our members face are deteriorating cash flows that constrained their ability to pay loans and rents and limited mobility that made it difficult to restart.”
Yujuico nevertheless noted that “even as we asked government for the extension for the filing and payment of the annual income tax, we encouraged our members who can file and pay their taxes early, to help government continue to have enough resources at (its) disposal to support our economy.