TRAIN 2 to make Philippines competitive, says ADB
The Asian Development Bank (ADB) debunked on Friday concern that the second package of the Tax Reform for Acceleration and Inclusion (TRAIN 2) could lessen investments in the Philippines.
In a press conference at the sidelines of the 51st ADB Annual Meeting in Mandaluyong City, Ramesh Subramaniam, ADB Director General for Southeast Asia Department, said TRAIN 2 would even make the Philippines competitive to local and foreign investors.
"We believe that the package will result in a system that will make the Philippines competitive," he said.
He admitted that ADB has been working with the Department of Finance regarding the TRAIN packages by providing support on overall analysis, communciations and on selected aspects, such as exapnded value added tax system.
"The TRAIN in fact aims to modernize the incentive system. It is not talking about removing incentives," Subramanian said.
He added the Duterte administration has conducted background studies and consulted with other available data and good quality benchmark assistance in other countries in the region.
Package 2, which is now pending in the House of Representatives, aims to lower the corproate income tax rates while modernizing investment incentives to level the playing field for 95 percent of business enterprises in the country.
Some lawmakers, particularly senators, have vowed not to rush the passage of the TRAIN 2 following an analysis by BMI Research that the proposed measure could slowdown investments over the near term.
The research arm of the Fitch Group has said the proposed conditional corporate tax reduction and repealing of fiscal incentives could create uncertainties for businesses. Celerina Monte/DMS