MTF Counsel Managing Partner, Atty. Euney Marie J. Mata-Perez was a guest panelist at the “Tax Forum: A Dialogue on the Proposed Comprehensive Tax Reform” sponsored by the Ateneo Graduate School of Business held on May 17, 2017 at their Rockwell Center Campus, Makati. Other panelists included the Hon. Deputy Speaker of the House of Representatives – Miro Quimbo, Bureau of Internal Revenue Asst. Commissioner – Atty. Marissa Cabreros, and TMAP President – Atty. Malou Lim. Moderators included ANC host – Salve Duplito and Professor Mon Abrea, Ateneo Graduate School of Business.

The proposed tax reform, especially the version of the substitute bill (House Bill No. 5636) raised various comments thoughts, suggestions and opinions from the panelists and the audience.

Deputy Speaker Quimbo expressed his view that the proposed tax reform is anti-poor, as it shifts from direct taxation to indirect taxation through the levy of higher excise taxes on basic fuels, like diesel fuel and kerosene which would prejudice the low-income consuming public.

While the panel generally agreed that an adjustment of personal income tax rates is needed and long over due, there are other consequences that should be carefully studied. Aside from the impact of the anticipated increase in excise taxes, there was also a concern that the proposed 8% tax on gross income on self-employed individuals could result in an administrative nightmare.

Atty. Mata-Perez opined that the new tax reform may not necessarily impose higher taxes on the “ultra-rich” who generally receive passive income, and not compensation or business income. Also, she believes that subjecting individuals earning Php5 million or above to a higher 35% tax in compensation income should be reviewed, inasmuch as categorizing those individuals as “ultra-rich” may not be as accurate.

Likewise, concerns were also raised as to whether or not there are reform measures that address the administrative inefficiencies and corruption at the Bureau of Customs and the Bureau of Internal Revenue.

It was also noted that the increased excise rates schedule on vehicles were adjusted in the substitute bill, as a result of the lobbying of the local automobile industry.

The panelists however, unanimously support comprehensive tax reform measures that support the development of the low and middle-income taxpayers, as well as the growth of the economy.

The Tax Forum was organized in cooperation with the House of Representatives, Senate of the Philippines, Department of Finance (DOF), Bureau of Internal Revenue (BIR), Tax Management Association of the Philippines (TMAP), and Center for Strategic Reforms of the Philippines (CSR Philippines).

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