A day after the House of Representatives resumed its session, the chamber approved on second reading three priority tax measures that is expected to generate P47 billion in additional revenues for the government.
On Tuesday, Nov. 8, lawmakers passed on second reading House Bill (HB) No. 4102, or the Single-use Plastic Bags Tax Act; HB 4122, or the value-added tax (VAT) on Nonresident Digital Service Providers (DSP); and HB 4339 or Package 4 of the Comprehensive Tax Reform Program (CTRP).
House Ways and Means Chairman Joey Sarte Salceda of Albay’s 2nd district is the principal author and sponsor of the proposed measures.
“With this, the House wraps up with all the priority tax measures of the Duterte-era Comprehensive Tax Reform Program, and is ready to move on to tax collection reforms, as prioritized by the Marcos administration,” Salceda said in a statement.
This means the bills are one step closer from passage in the House of Representatives.
If enacted, the measures could raise additional revenues totaling P47 billion every year, Salceda said.
These revenues will include some P19 billion from the non-resident DSP, P9.3 billion from plastic bags, and P20 billion from Package 4 of the CTRP.
“That is around two percent of BIR (Bureau of Internal Revenue) collection targets, and 0.2 percent of GDP (gross domestic product), so (Finance) Secretary (Benjamin) Diokno only needs to look for 0.1 percent of GDP more in tax collection improvement,” he noted.
“The Medium -Term Fiscal Framework, which we in Congress approved, takes into account 0.3 percent of GDP in tax collection efficient improvement every year,” Salceda added.
The House leader also emphasized some key points for the approved measures, one of which is the VAT on digital services will not be imposed on Filipino businesses.
“The emphasis is on foreign or nonresident digital service providers. All major ASEAN economies impose VAT on these entities. Tayo na lang ang hindi (We’re the only ones who don’t),” he said.
The economist-congressman added that the plastic bags tax measure is in line with the country’s efforts to fight sea pollution, especially “as we are now recognized ignominiously as the world’s biggest ocean plastic polluter.”
The Single-use Plastic Bags Tax Act will impose an excise tax of P100 per kilo of disposable plastic bags.
As for Package 4, Salceda said that the lifting of the exemption on pickup trucks “merely corrects an unfair privilege on a vehicle that is mostly for the rich, occupies very large space on the road, and is by all accounts less fuel-efficient than most other vehicles.”
The lawmaker expects the approval of the measures on third and final reading in the House by Monday or Tuesday next week.
At the same time, the Bicolano is looking forward to the discussion of the proposed bills in the Senate, which is also expected to tackle the proposed Ease of Paying Taxes Act.
“I think we will have at least one tax law enacted over the next six months, very possibly EOPT. But I am hopeful that we will have at least one more, hopefully one of these three.”