MANILA - The government should improve on tax collections and attract investments to create more jobs and fuel economic recovery instead of imposing wealth tax as proposed by presidential candidate Ka Leody De Guzman, business groups said Monday.

During the Kapisanan ng mga Brodkaster ng Pilipinas Forum, De Guzman reiterated his push for 20-percent wealth tax to be imposed on the 500 richest families in the country to fund social services.

But instead of gains, wealth tax may result in capital flight, reduced investments and therefore cut funds for economic growth and creation, Management Association of the Philippines president Alfredo Pascual told ANC.

"Wealth taxes could be scary, negative implications, some potential adverse effect," Pascual said.

"What we need to do is focus on the economy and do what’s necessary to attract investments and enable the environment so that more business can be set up and jobs can be created…let’s pursue those reforms, that’s the way to go rather than thinking of new taxes to put again as a burden," he added.

Instead for crafting new tax "burden," Pascual proposed improving collections from current tax laws as well as the passage of tax reforms.

President Rodrigo Duterte's economic managers have designed a comprehensive tax reform program (CTRP) to improve collection as well as enhance tax policies.

The Tax Reform for Acceleration and Inclusion (TRAIN) law as well as the Corporate Recovery and Tax Incentives for Enterprises or (CREATE) were part of the reforms.

The government can also focus on attracting investments to generate more jobs or possible increases in value-added tax (VAT) for items not included in the expenses of the poor, said Makati Business Club Chairman Edgar Chua.

"I don’t think wealth tax is the way to go. What we need to do is increase the size of the pie. Attract investments, generate employment and maybe we can looking at increasing VAT but remove them on items which comprise the bulk of the expenses of the poor, food and drinks, services, medicines," he said.

Aid for the disadvantaged should also be improved such as the conditional cash transfer, feeding program, lifeline for water and electricity, fuel subsidy for public utility vehicles and education, Chua said.

Other groups who have earlier expressed their sentiments against the proposed measure said imposing wealth tax could also fuel tax avoidance.

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On presidential aspirant Manny Pacquiao's push for the increase in non-tax revenues, Pascual said these funds composed less than 10 percent of the government collections.

"We can rely on them to some extent, but not heavily," he said.

Some funds generated from non-tax sources are also not remitted back to the treasury as these have already been allocated, Pascual said.

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