The Department of Finance’s (DOF) proposed Package 4 of the Comprehensive Tax Reform Program (CTRP) refined by the current finance chief is now expected to yield revenues for the government instead of initial estimates of revenue loss.
In a social media post, the DOF said the revised measure presented to the Senate committee on ways and means last Monday is expected to yield P12.2 billion in revenues from the third quarter of 2024 to 2028.
In comparison, P83 billion in foregone revenue was estimated from the original version of the bill while a P19.3 billion revenue loss was seen in the House version.
DOF assistant secretary Karlo Adriano, who made the presentation to the Senate, said the revised proposal aims to front-load the implementation of the revenue-increasing provisions in 2024 and back-load some of the revenue-eroding provisions in 2028 when the country is in a much better fiscal position.
Package 4 seeks to encourage growth in key financial markets by simplifying the tax structure on passive income, and on certain instruments and other financial products.
Finance Secretary Ralph Recto earlier said the DOF has no new tax proposals but is recalibrating its existing priority tax measures to guarantee that these are fairer, easier to collect and more practical, while ensuring that these reforms will not translate to unnecessary burden to consumers and taxpayers.
“Just by shifting the implementation backward or forward, you can actually achieve a revenue gain. (It may be) minimal, but at least, it’s not going to be detrimental to our fiscal health. So, I can see that this is where his (Recto) experience and knowledge in managing fiscal situations would come in,” said Senator Sherwin Gatchalian, Senate committee on ways and means chairperson. – Angela Celis
