The House of Representatives is targeting to send the Senate its approved version of the proposed amendments to the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act by the end of November, a House leader said on Tuesday. During the hearing, House Ways and Means Committee chair Joey Salceda said the proposed amendments under the CREATE MORE bill would 'make the tax incentives system more responsive to the global market and more globally competitive.' The proposal, Salceda said, is aligned with President Ferdinand R. Marcos' directive to fix the issues raised by investors with the current law and how it is implemented. 'We will send the Senate our version by the end of November. We will also approve this in the Committee next week. We were prepared to do it today, but the Office of the President requested for a bit more time to finalize its comments,' he said. Salceda said the House version of the bill would address the value-added tax (VAT) rate and refund issues, especially for exporters. Other enhancements include the reduction of the corporate income tax to 20 percent for those under the enhanced deduction regime, a 200 percent deduction for power cost, which may be accumulated while availing of an income tax holiday (ITH), a 200 percent deduction for trade fair and trade mission expenses, and the application of the Net Operating Loss Carryover five years after the end of the ITH period, he noted. He said the proposal would also include a uniform 1.5 percent registered business enterprise local tax (RBELT) to be collected by investment promotion agencies 'in lieu of all local impositions' to reduce the point of contact with local government units. A special skills visa will likewise be granted to highly technical personnel employed in registered business enterprises. He further highlighted that the Information Technology Business Process Outsourcing sector would be allowed to fully undertake work-from-home schemes. 'This will allow one of the country's most durable sectors to remain globally competitive. The world has moved towards hybrid, and it does not make sense to limit ourselves in this area," he said. Salceda said the committee 'wholeheartedly supports" the President's direction to "wind down" the power of the Fiscal Incentives Review Board to grant and approve fiscal incentives. ''The President wants to make the approval process more responsive. And we agree fully. So, the Committee has reverted the power to grant and approve incentives to the Investment Promotion Agencies," he said. The panel is considering removing the proposed motu proprio power of the President to grant tax incentives to maintain the spirit of a performance-based and standards-based tax incentives system. Salceda also said they hope to strengthen the power of the Fiscal Incentives Review Board to recommend policies against the abuse of fiscal incentives for smuggling and tax evasion.
Source: Philippines News Agency