Lowering taxes on stock transactions could bring in P4.3 trillion in economic value and attract more foreign investors in the country.
This was according to AnaKalusugan party-list Rep. Ray Reyes who said the country stands to gain trillions of pesos should stock trading taxes is brought down.
“According to our studies, it is expected that P4.3 trillion in economic value will come to the Philippines when the tax rates on stock market transactions are lowered,” Reyes, a member of the House committee on ways and means, said in a statement.
“These are funds that could greatly contribute to public health investing to ensure that the Filipino people is healthy and has access to adequate healthcare services,” he said.
Reyes filed House Bill 9277 seeking to amend the National Internal Revenue Code and reduce stock transaction tax from six-tenths of one percent to one-tenth of one percent.
According to the lawmaker, the reduction in friction costs would boost the country’s investor appeal and create more opportunities for active investors.
“The whole country will benefit from this because more local and foreign investors will be encouraged to invest in our stock market” Reyes added.
The legislator also said reducing transaction tax is expected to generate an increase in transaction volume , citing the case of Taiwan which reduced its transaction tax from 0.5 percent to 0.25 percent, resulting in a net effect of 6.33 times in transaction volume.
“The case of Taiwan proves how tax reductions can stimulate investment and encourage wider participation in the financial market,” Reyes said.
“By attracting more foreign and local investors, we can realize the potential of the financial sector to help in improving the lives of all Filipinos,” he added.