“I thank my colleagues, especially our co-authors Senate President Franklin Drilon and Senate Pro Tempore Ralph Recto, and our counterpart in the House of Representatives, Congressman Miro Quimbo, who worked tirelessly and had joined me in an eight-hour bicam meeting so as to reconcile the two versions and come up with a bill that would best shed light on the tax incentives granted by the government,” said Angara, chairman of the Senate ways and means committee.

Other members of the bicam committee were Sens. Cynthia Villar, Bam Aquino, JV Ejercito, and Reps. Leni Robredo, Dakila Cua, Sharon Garin, Victor Noel and Bebot Bello III.

Under the bill, registered business entities must file with their investment promotion agencies (IPAs) a complete annual tax incentives report of their income tax holiday or other income-based tax incentives, value-added tax and duty exemptions, deductions, credits or exclusions from the tax base.

The IPAs are then required to submit to the Bureau of Internal Revenue (BIR) their annual tax incentives reports based on the individual reports filed by registered business entities.

The BIR and the Bureau of Customs (BOC) must submit to the Department of Finance (DOF) information on the tax and duty incentives of registered business entities as reflected in their filed tax returns and import duties, as well as actual tax and duty incentives as evaluated and determined by the BIR and BOC.

For monitoring and analysis of tax incentives granted, the DOF shall maintain a single database and submit to the Department of Budget and Management (DBM) the following data: (a) actual amount of tax incentives availed by registered business entities, (b) estimate claims of tax incentives immediately preceding the current year, (c) programmed tax incentives for the current year, and the (d) projected tax incentives for the following year.

For transparency purposes, these data and information will be reflected by the DBM in the annual Budget of Expenditures and Sources of Financing, which shall be known as the Tax Incentives Information section.

Meanwhile, the National Economic and Development Authority (NEDA) is mandated to conduct cost benefit analysis on the investment incentives to determine the impact of tax incentives on the economy.

Angara further stressed that the proposed TIMTA would not tamper with the fiscal incentives presently enjoyed by the private sector given a provision under the bill which explicitly states, “nothing in this Act shall be construed to diminish or limit, in whatever manner, the amount of incentives that IPAs may grant.”

Any registered business entity which fails to comply with filing and reportorial requirements will be penalized with a fine amounting to P100,000 for its first violation; P500,000 for the second violation; and, cancellation of the registration of the business entity for the third violation.

“The bill focuses on promoting transparency and accountability which will in turn strengthen the confidence of investors to bring more businesses to our country, thus providing more opportunities and jobs for our countrymen,” the lawmaker said.

TIMTA, which is one of the priority economic reforms of the current administration, will be transmitted to the Malacanang for President Aquino’s signature.

Source: www.senate.gov.ph