The American Chamber of Commerce of the Philippines has joined the long list of prominent organizations from various sectors that have expressed their support for the proposed Tax Reform for Acceleration and Inclusion Act, saying that it passes its criteria of being highly progressive, consumption-based, and providing incentives for people to work, save and invest.
In an official statement, the AmCham formalized its support for this first package of the Duterte administration’s Comprehensive Tax Reform Program that is now set for plenary deliberations in the Senate.
“The American Chamber of Commerce of the Philippines strongly supports the comprehensive tax reform legislation of the Duterte Administration (known by the acronym TRAIN) in its overall goals,” the group said.
AmCham also said it supports a tax reform that is “(1) fair, (2) progressive, (3) improves tax collection, (4) funds physical and social infrastructure, and (5) supports investors,” which are all qualities of the TRAIN.
The House of Representatives passed its version of TRAIN—House Bill No. 5636—last May 31. The Senate ways and means committee has passed its TRAIN version last Sept. 20 and the panel chair, Sen. Juan Edgardo Angara, has sponsored the bill for plenary approval.
AmCham said that in broad terms, it supports taxes that are: “(1) more progressive than regressive, (2) that incentivize individuals and corporations to work hard to produce income, to save and invest, and (3) that impose a significant burden of taxation on consumption.”
The proposed TRAIN aims to slash personal income tax rates, while widening the base for consumption taxes such as the value-added tax and the excise taxes imposed on fuel and automobiles, among other measures.
According to AmCham, the TRAIN bill is fair because it adjusts current PIT rates that have remained unchanged since 1997 and corrects the “income bracket creep” that has resulted in employees taking home less pay every year.
“Our employees deserve to have the real purchasing power of their earnings returned to them in recognition of their labor,” it said.
The TRAIN bill is also progressive as “it raises more income through modest increases in taxes on consumption, such as reducing VAT exemptions, raising taxes on fuel, and increasing taxes on automobiles and other consumables,” AmCham said.