SENATOR Sherwin Gatchalian says the enactment of the proposed Ease of Paying Taxes Act is expected to drive foreign direct investments (FDIs) and enhance the country’s competitiveness as an investment destination.
“We are hoping that more investors will be encouraged to put their business in the country if paying taxes will be much easier,” he said
The measure was recently approved by a bicameral committee and now awaits the signature of the President.
The chairman of the Senate ways and means committee noted that digitalization is the most important facet of the bill.
“And the measure seeks to mandate the Bureau of Internal Revenue to come up with its digitalization roadmap that will be submitted to Congress and updated regularly,” he said.
According to the senator, institutionalizing the BIR’s digitalization initiative ensures that the implementation of the program will be sustained in the years ahead.
“We have a bad habit in the country that with every change of administration, there is a change of plan, a change in roadmap, a change in projects. More often than not, this derails the implementation process because they completely change the system, the vendor, or the supplier that derails the project,” Gatchalian said.
He emphasized that such a digitalization roadmap is subject to regular review by Congress to ensure constant implementation.
“What we envision is to make it easier for medium-sized foreign companies to set up shops here. We need to make it easier for them to navigate our tax system and to be tax compliant as easily as possible,” said Gatchalian.
One of the priority measures identified by the Legislative-Executive Development Advisory Council (LEDAC), the proposed Ease of Paying Tax Act aims to provide more equitable and simplified tax compliance requirements, promote taxpayers’ welfare, and guarantee sustained revenue growth.
The measure will simplify tax filings for micro and small enterprises, allow for the electronic filing of taxes, and accelerate value-added tax (VAT) refunds by shifting to an invoice system.
FDI in the country fell 20.4 percent to $3.911 billion in the first half of the year, according to data released by the Bangko Sentral ng Pilipinas. According to the BSP, the decline from the $4.9 billion net inflows recorded in the first half of 2022 could be attributed to investor concerns emanating from persistent global uncertainties.
