The House committee on ways and means has approved the bill seeking to increase the excise tax on alcohol and the Tax Reform for Attracting Better and High-quality Opportunities (TRABAHO) Bill.
House Bill 1026, which adopted the version approved on third and final reading by the House of Representatives during the 17th Congress, was approved on August 12 with all 43 members present voting in favor.
This bill seeks to impose a higher sin tax on alcohol by amending Republic Act No. 8424 or the National Internal Revenue Code (NIRC) of 1997 to raise the rate of alcohol excise tax to 10 percent.
House Bill 176, the TRABAHO or TRAIN 2 Bill, was approved on August 13 with a vote of 27-2. This is the second package under the Duterte administration’s Comprehensive Tax Reform Package.
The measure seeks to encourage investments by gradually reducing the country's corporate income tax (CIT) rate to 20 percent from the current 30 percent.
The alcohol sin tax bill was substituted with a bill that expanded coverage to include electronic cigarettes and heated tobacco products.
This substituted version was passed on 2nd reading on August 14, after a viva voce voting.
Representative Joey Sarte Salceda (2nd District, Albay), who chairs the House committee on ways and means, said the bill aims to discourage the excessive consumption of alcohol and reduce accidents caused by driving under the influence as well as its harmful effects on the health of consumers.
Meanwhile, the TRABAHO Bill proposes to reduce the corporate income tax by two percentage points every two years until it reaches 20 percent by January 2029. The reduction is eyed to start on January 1, 2021.
Salceda said this would bring the Philippines at par with other Asian economies, which impose a CIT of only 20 percent.
The bill also provides for the removal of not only preferential tax rate of certain corporate taxpayers but also the option for corporations, including resident foreign corporations, to avail of the 15 percent gross income tax.
The same version was passed by the House at the tail-end of the 17th Congress. The Senate, however, failed to pass its version.
This bill will be consolidated with other similar bills: HB 313 by Rep. Salceda, HB 1042 by Rep. Kristine Singson-Meehan (2nd District, Ilocos Sur), HB 1909 by Deputy Speaker Luis Raymund "LRay" Villafuerte Jr. (2nd District, Camarines Sur), HB 2084 by Rep. Junie Cua (1st District, Quirino), HB 2554 by Rep. Sharon Garin (Party-list, AAMBIS-OWA), HB 2704 by Deputy Speaker Aurelio "Dong" Gonzales (3rd District, Pampanga), HB 2956 by Rep. Michael Romero (Party-list, 1-PACMAN), and HB 3356 by Rep. Ann Hofer (2nd District, Zamboanga Sibugay). (Ventures Cebu)