Leaders of the country’s top exporting industry will meet with Finance Secretary Carlos G. Dominguez III next week to discuss their concerns over some of the provisions in the second package of the Comprehensive Tax Reform Program (CTRP).

The Semiconductors and Electronics Industries in the Philippines Foundation Inc. (Seipi) is up for a meeting with Dominguez on February 20 to thresh out the contents of the second tax-reform bill. The CTRP’s second package is aimed at lowering corporate-income tax and rationalizing tax incentives. Seipi President Danilo C. Lachica said they have “prospective  ideas” the Department of Finance (DOF) might like to hear on how to make sure the measure will not scare off investors.

“I think the lower corporate-income tax would be better, and the lower personal-income tax, I think we all like that,” he said in a recent news briefing.

“There are opportunities that probably we can improve on, and we are going to be giving suggestions and prospective ideas to the government,” Lachica added.

Nonetheless, he vowed the electronics industry is backing all the remaining packages of the CTRP, the first of which—the Tax Reform for Acceleration and Inclusion (TRAIN)—was signed into law last December.

“Whether it is the DTI [Department of Trade and Industry] or the DOF, we will work closely with the government. We support the government’s initiative [because] it is good for the country,” Lachica said.

He added the sector understands the need of the government to generate revenue to be able to finance its multitrillion-peso infrastructure program. “The money has to come from somewhere and we want to do our part,” Lachica said. “We are engaged in a dialogue with the DOF and other agencies in the government because we fully support the initiatives, and we do have some ideas and suggestions on how it can be implemented better. Nonetheless, we are all for it,” the Seipi chief said.

On Semiconductor Philippines Inc. President and General Manager Sunil Banwari said the industry was more upbeat following the enactment of the TRAIN into law.  “I have seen a lot of optimism in the work force about their tax benefits covering all associates, and I think they are definitely looking forward to the benefits,” he said.

“We are working closely with tax experts as to how we can maximize the take-home pay for the associates. We are [now] engaging in a dialogue with the DOF to understand better [the CTRP’s second package],” Banwari added.

The industry’s confidence in the government remains unshaken, and this was mainly due to its peak-level performance last year. Electronics exports recorded all-time high earnings of $32.70 billion in the previous year and accounted for 52 percent of the country’s total merchandise exports. Last year’s performance was 11 percent higher than that of $29.4 billion posted in 2016. In spite of its strong showing in the previous year, Seipi’s growth outlook for the sector this year is projected at 6 percent.

Image Credits: Nonie Reyes