Senate eyes CREATE MORE bill passage next week

THE SENATE plans on approving “next week” a measure that will lower income tax on both local and foreign companies, according to the Senate president.

Senators aim to wrap up the period of amendments on Senate Bill No. 2762, the Corporate Recovery and Tax Incentives for Enterprises to Maximize Opportunities for Reinvigorating the Economy (CREATE MORE) bill, Senate President Francis “Chiz” G. Escudero said at a forum in Manila, Wednesday.

“Hopefully, we will be able to complete that (period of amendments) today (Wednesday) so that by next week we can approve this,” he said in mixed English and Filipino.

The House of Representatives passed its version of the bill on final reading in March.

The priority measure removes value-added tax (VAT) on goods and services to essential services such as janitorial, security, financial consultancy, marketing and human resources.

Mr. Escudero said the bill is crucial to create more jobs for Filipinos after the government banned Philippine offshore gaming operations (POGOs).

“With CREATE MORE, we need to specify and ensure that Filipinos are given jobs in the country, along with the incentives that will be given to foreign businessmen that will do business here,” he said in Filipino.

Philippine President Ferdinand R. Marcos, Jr. in his third address to Congress declared a ban on POGOs, citing their links to criminal syndicates among other crimes, such as human trafficking.

The Department of Labor and Employment has said the measure would help more than 20,000 Filipino workers affected by the ban to find work by the end of the year.

Under the bill, registered business enterprises will be entitled to a 100% additional deduction on power expenses in a taxable year, up from 50% under the Tax Code, to address high power costs.

It would also allow local firms to implement a work-from-home setup for up to half of their workforce to cut costs.

The measure also grants the President authority to give fiscal and nonfiscal incentives to enterprises without the need for a recommendation from the Fiscal Incentives Review Board. 

“It is not merely an update of policies; it is about creating a more dynamic future that is more responsive, more supportive and more capable of fostering growth and innovation in the Filipino people,” Senator Sherwin T. Gatchalian, who sponsored the bill, told the Senate floor earlier this month.

The CREATE MORE bill is among the two key revenue measures the Philippine government is banking on to help sustain growth and climate resilience, the Department of Finance said.

“A new law is underway that will improve our tax incentives policy and tailor-fit investors’ interests to attract more investments in clean and renewable energy, green infrastructure, sustainable agriculture, and waste-to-energy technologies, among others,” Finance Secretary Ralph G. Recto said at a forum on Wednesday.

BOOST ‘GREEN’ INVESTMENT
“We are also awaiting the passage of a bill imposing an excise tax on single-use plastic bags to cut pollution and adopt more sustainable practices,” he added referring to the proposed VAT on single-use plastics would bolster “green” investments and lessen the volume of plastics in the country.

Congress has yet to act on the proposed P100 excise tax on single-use plastics.

The government’s recent expansion of zero tariff rates on electric vehicles (EVs) placed the country at the forefront of green technology and EV manufacturing, Mr. Recto said. These are supported by the active issuance of sustainability bonds to finance both green and social projects nationwide.

These show how fiscal policies are being utilized to make the country suitable for “green” investments, Mr. Recto said, noting the Philippine economy cannot grow without bolstering climate resilience.

“Climate change is deeply unfair. It strikes the hardest at the poorest. It makes poverty worse. And as climate impacts grow, so too will the difficulty and cost of eradicating poverty in the country,” he said.

The Finance chief said the government’s Medium-Term Fiscal Program serves as the “overall blueprint for sustainable economic growth while upholding the highest standards of fiscal discipline.”

“This enables us to prudently finance green infrastructure, support local adaptation projects, educate our people on climate consciousness, create green jobs, and reduce poverty along the way,” Mr. Recto said. — John Victor D. Ordoñez and Beatriz Marie D. Cruz