The Finance Department said the reduction in corporate income tax to 20 percent from 30 percent under the second package of the comprehensive tax reform package will generate 1.4 million jobs between 2021 and 2029.
The agency said in a statement the proposed reduction of the CIT by 2 percentage points every two years starting 2021 until 2029 would create over a million jobs as it would free up more capital for firms to invest and hire more workers.
“This tax reform, once approved by Congress and enacted into law, will create an estimated 113,944 jobs in 2021 all the way up to 1.4 million in 2029,” said Finance assistant secretary Antonio Joselito Lambino II.
This is in line with Finance Undersecretary Karl Kendrick Chua’s earlier statement on the first Senate hearing on corporate tax reform that the CIT’s reduction would have a positive impact on job generation.
“With lower tax rates, such a proposal is hardly inflationary while creating over a million jobs over the medium term as firms expand with more money at their disposal,” Chua said.