MANILA, Philippines - The government has lost more than P200 billion in 2012 and possibly more last year due to tax exemptions and reductions enjoyed by a number of investors, the Bureau of Internal Revenue said.
This preliminary data is the reason why the Department of Finance (DOF) has been pushing for the passage of the fiscal incentives bill in both houses of Congress, BIR Commissioner Kim Jacinto-Henares told reporters late last week.
“I am not saying that we should get rid of all the incentives for investors. What I’m saying is you should only give incentives to people who need them to become profitable,” Henares explained.
“If you’re profitable already, you have the obligation to share it with the country because you’re availing of the services of the country. That’s the reason why there is a need for the rationalization of fiscal incentives,” she continued.
Fiscal and non-fiscal sweeteners are aimed at increasing foreign and domestic investments in the country. But some firms, Henares noted, have enjoyed too many years of not paying taxes that the incentive packages being extended by a number of agencies should be reviewed.
The DOF specifically wants the authority to grant these incentives be given solely to the Board of Investments. This means other agencies such as the Philippine Economic Zone Authority, the Bases Conversion Development Authority, and other economic zones will not be allowed to offer perks to interested investors.
The fiscal incentives bill, one of the Aquino administration’s top priority measures, has failed to secure approval in Congress for about 15 years now, the commissioner recounted.
The piece of legislation currently remains pending in both the lower and upper houses of Congress.