The “closest and most productive” ties between Congress and the Executive became fruitful, and delivered enduring credit ratings which strengthen the country’s negotiating position in the procurement of COVID-19 vaccines, according to House Ways and Means Chair Albay 2nd District Rep. Joey Sarte Salceda.
The Lower Chamber’s chief tax policymaker made the observation after Fitch Ratings affirmed the country’s Long-Term Foreign-Currency Issuer Default Rating (IDR) at ‘BBB’, with credit outlook at ‘stable.’
“Our strong credit ratings are the product of the closest and most productive partnership between the House tax committee and the executive’s fiscal policymakers since 1986,” Salceda said in statement.
In its report, Fitch cited “the impact of the Corporate Recovery and Tax Incentives for Enterprises Act (CREATE) tax package, which has been passed by both houses of Congress, and also Package 2+: Sin Taxes (part of the Comprehensive Tax Reform Program) passed in early 2020”. The measures were principally authored by Salceda.
Salceda recalled that last year, the credit benchmarker implemented 51 credit rating downgrades affecting 33 sovereigns, some of which were downgraded more than once.
These include countries that previously had the same rating as the Philippines, such as Mexico, Colombia, and Italy—whose ratings were downgraded by a notch to the minimum investment grade of “BBB-”, he noted.
“More tax reforms have been approved by my committee than ever in recent history. That has given the world the confidence that we take our finances seriously,” Salceda said.
Among the tax measures that already hurdled the Salceda panel were the Digital Economy Taxation Act, the E-Sabong Taxes Act, the Fiscal Regime for Mining, the POGO Taxation Act, and the Tax Amnesty Act.
Salceda cited that the country’s strong credit ratings signal the presence of the “elements of quick economic recovery.”
“Of course, the best way to leverage this strength is to buy the vaccines quickly and get them rolled out without delay. Speed will save lives and the economy,” he said.
He cited that good credit ratings also strengthen the country’s negotiating position in vaccine procurement.
“It tells large private vaccine-producers that we can pay for these vaccines smoothly,” Salceda said.
“We should also have no difficulty accessing financing for even more vaccines should we ever need to bid for our share,” the principal author of the House Bill No. 8285 or the Bayanihan sa Bakuna Act said.
Salceda expressed Lower Chamber’s readiness to tackle measure that seek to expedite the vaccine rollout once Congress buckles down to work on January 18, Monday.