Senator Benigno Aquino IV on Sunday admitted that the government’s Tax Reform Acceleration and Inclusion Law has impacted negatively on the BPO sector.
The lawmaker said he has been receiving reports that the BPO sector may need to reduce its workforce or set aside expansion plans in the country.
Aquino, chairman of the Senate committee on science and technology, has scheduled a second hearing on the issue today.
“The BPO sector is a major source of livelihood for Filipino families. We cannot afford to give away job security and job opportunities, especially with the rising prices of goods,” he said.
Aquino revealed that several BPOs may relocate, abort expansion, or reshore workers due to the effects of the TRAIN Law.
“When we first conducted the hearing last year, AI emerged as the main threat to our BPO industry. Now, we saw the need to include the government tax reform program as it is also taking a toll on the sector,” he said.
During the TRAIN’s period of amendments, Aquino pushed for the retention of a special tax rate for regional operating headquarters and regional headquarters.
However, the provision was vetoed by President Rodrigo Duterte, much to the dismay of BPO stakeholders.
He said the veto will lead to an increase in cost of doing business, which will affect the status of 5,000 workers and prevent other BPOs from setting up shop in the Philippines.