With less than two-years left before the Duterte administration ends its term, the Department of Finance (DOF) urged lawmakers during the House constitutional amendments hearing that they should focus on pending measures that are “immediately doable.”
Finance Secretary Carlos G. Dominguez III said the long-due reforms in the corporate income tax (CIT) and fiscal incentives system as well as easing the "inordinate" restrictions on foreign ownership in certain sectors of the economy should be prioritized by Congress.
These measures include the proposed Corporate Recovery and Tax Incentives for Enterprises Act (CREATE) and amendments to “anachronistic” laws such as the 84-year old Public Service Act, the Retail Trade Liberalization Act and the Foreign Investments law.
“What is most important is to undertake what is immediately achievable,” Dominguez said during the hearing by the House committee on constitutional amendments on the latest initiative on Charter change.
“It is preferable, of course, to achieve the liberalization reforms in one blow. But if there are things that we can do to open up the economy through administrative measures, we must implement them,” the finance pointed out.
“If there are areas that we can liberalize by amending our existing laws, then let's do that,” added Dominguez, who is President Duterte’s chief economic manager.
Once these priority measures are enacted into law, Dominguez said they will help jumpstart the Philippines’ recovery from the global economic slump unleashed by the lingering COVID-19 pandemic.
“We call on our legislators to swiftly ratify the CREATE bill. As I have mentioned earlier, we want to push for the passage on the amendments to the Foreign Investment Act and the Public Service Act. We also need to modify the Retail Trade Liberalization Act,” Dominguez said.
Dominguez, however, declined to provide any advice to House lawmakers on the means to amend the restrictive economic portions of the Constitution, noting this decision is “a political question.”
“I would not dare advise our legislators on the matter,” he said.
Dominguez, however, admitted that restrictive economic conditions of the Constitution discouraged foreign direct investments (FDIs) in the country.
Starting the process towards a more liberalized investment climate through the passage of pending economic priority bills “will be a strong signal to the international investment community that the Philippines is open for business,” Dominguez said.
“Immediately, the Congress can help in restarting our economy by acting on our pending priority economic bills,” Dominguez said.
These measures will complement the reforms that the government is now implementing, such as the "Build, Build, Build" infrastructure modernization program and the Ease of Doing Business law, Dominguez said.