Congress needs to pass other tax packages to avoid borrowing, official says
Congress has to pass other proposed tax packages of the Duterte administration, otherwise, the government could resort to borrowing, which is not good for the economy, an official said on Wednesday.
In a press briefing in Malacanang, Education Secretary Leonor Briones, a former National Treasurer, underscored the importance of passing the four remaining packages of the Comprehensive Tax Reform Program within the year.
"The plan is already laid out. The last recourse, of course, is to borrow. That is not the most pleasant experience that one can undergo...especially with a country like the Philippines, which had a very unhappy experience during the global crisis and of course the impact is the law on supply and demand, interest rates will be higher," she said.
"Unless also Congress will cut the expenditures which it will not also do at this time," she said.
Briones expressed the belief passing tax measures are a better option.
"But we have to watch where the taxes go and we have to watch who are going to bring those taxes," she added.
Some lawmakers, including Senate President Vicente Sotto III, have expressed hesitance to pass the other tax packages following the impact of the Tax Reform for Acceleration and Inclusion (TRAIN) law on inflation.
But government officials have reiterated the effect of the TRAIN law on inflation was minimal at less than one percent.
In a forum in Manila, Budget Secretary Benjamin Diokno expressed optimism that the remaining tax packages would be passed before the end of the year.
"Otherwise, you can say goodbye to it...it's either this year or forget it because 2019 is an election year...if not passed this year, then we will refile it under a new Congress, 2019," he said.
He said the impact of the failure to pass the other proposed tax measures would be felt after 2019.
President Rodrigo Duterte, in his third State of the Nation Address, has urged Congress to approve the remaining tax measures, particularly the Package 2, which aims to lower corporate income tax rate, within the year. Celerina Monte/DMS
