Finance Secretary Carlos Dominguez III is seeking the support of top economists in improving the country’s corporate taxation system which he said is “plagued with structural defects.”
Dominguez, in a lunch meeting with economists, cited the need to improve the corporate tax system where a small select group of top enterprises enjoys preferential corporate income tax rates of just 6 percent to 13 percent while the small- and medium-scale enterprises pay the regular rate of 30 percent.
Dominguez also sought the guidance of the economic experts in fine-tuning the Finance Department’s proposal to reduce the CIT rates and modernize the investment incentives, which comprise the second package of the Duterte administration’s comprehensive tax reform program.
“It is in this historic moment that a statement of support from you, our country’s eminent economists, for the second tax reform package would be most welcome as those who benefit from the status quo are quite active and vocal in their opposition [of this reform],” Dominguez said.
He said the DoF needed the support of the economists for the basic proposals under Package 2 of the tax reform program. These included lowering the CIT rate while reorienting the fiscal incentives regime to attract the “industries of tomorrow”.