By Vanne Elaine Terrazola
The Senate will now start reviewing the second tranche of the administration’s tax reform program after its approval in the House of Representatives.
Senate President Vicente Sotto III on Tuesday said he has asked his colleagues to look into the House-approved Tax Reform for Attracting Better and High Quality Opportunities (TRABAHO), earlier known as TRAIN 2.
Sotto confessed that House Speaker Gloria Macapagal-Arroyo talked to him and asked him to go over their House Bill 8083, supposedly telling him that it was a “better” version of the administration and had more chances of hurdling the Senate.
Sotto, who penned a Senate bill on the Duterte government’s second tax package, said he is open to adopting the House version should he and his colleagues find it substantial.
Senators earlier expressed qualms about the passage of another TRAIN law amid the surge in the prices of consumer goods and services. They feared that the removal of the corporate tax incentives may result in unemployment if applied to job-generating sectors, such as economic zones.
Sotto said the possibility of approving the original proposal of the executive branch are slim as he pushed instead for the rationalization of the said incentives.
But with the approval of House Bill 8083, the Senate Committee on Ways and Means would have to deliberate on the priority measure. Sotto said he will ask Senator Sonny Angara, committee chair, to look into the proposal.
“If it is going to be beneficial, if it will not redound to additional problems on taxes, or might contribute again to inflation, we will definitely support it,” Sotto said.
Sotto cannot commit yet on the swift passage of the TRABAHO as they await the transmittal of the Lower Chamber.
Senate President Pro Tempore Ralph Recto, although expressing his support for the objectives of the tax measure to lower income tax, said it may not be the right time to pass TRABAHO.
“TRAIN 2 may be inflationary because it increases taxes on domestic industries such as housing, power, petroleum, among other things. It will also increase taxes and cost of exporters and BPOs, and therefore reduce incentives to invest in enterprises that earn foreign exchange which our economy badly needs at this time,” he said when asked for comment.
The reduction in corporate income taxes, Recto added, might not be enough to attract investment as he also noted current “global economic events.”
Recto said he expects the ways and means panel to hold several hearings on the bill, and consult various stakeholders on its possible impact.