PCCI aims for early passage of the CREATE MORE bill

THE PHILIPPINE Chamber of Commerce and Industry (PCCI) called for the immediate passage of the Business Recovery and Tax Incentives for Enterprises Bill to Maximize Opportunities for Revitalizing the Economy (CREATE MORE), saying it addresses inconsistencies in the current law will correct.

In a statement, the PCCI said the CREATE Act currently in force does not distinguish between an export business and a domestic market business in the context of separate customs territories.

“This situation discourages local suppliers of manufacturers within free port zones,” PCCI President Enunina V. Mangio said in the statement.

She added that the law penalizes manufacturers/exporters because they absorb the value added tax passed on to them by their local suppliers.

“Which they pass on to consumers, making them uncompetitive in the global market,” she said.

The PCCI said domestic companies have stopped taking advantage of their incentives, including the 5% tax on gross income earned.

The CREATE MORE bill, which aims to reduce corporate tax from 25% to 20%, has been approved by the House of Representatives. Ffinal reading in March and has been passed on to the Senate.

The PCCI also declared support for CREATE MORE’s goal of streamlining the tax refund process.

“Refunds (value added tax) represent sums of money owed by the government to zero-rated taxpayers and investors who had already paid VAT in advance on their purchases or investments. This is taxpayers’ money being uselessly locked up in the government, rather than being used to generate economic activity,” said Benedicta Du-Baladad, Director of Taxation and Investment Policy at PCCI.

She added thatffshortcomings in the refund system have increased the cost of doing business.

“Amid the current administration’s aggressiveness to attract foreign direct investment and strengthen the economy, we must be able to improve our absorptive capacity by relaxing the cost of doing business and making it more competitive,” Ms. Mangio said.

The PCCI also recommended that registered companies in good standing with their respective investment promotion agency should be provided with an extension of indirect tax incentives, including import duty exemption, VAT exemption on imports and zero VAT rate on local purchases. — Adrian H. Halili