A lawmaker on Tuesday said that the rollout of the Covid-19 vaccine, passage of the corporate income tax and incentives reform bill, and the economic amendments to the 1987 Constitution are the “key pillars” of the country’s short, medium, and long-term economic strategy.
House Economic Stimulus and Recovery Cluster co-chairman Joey S. Salceda said the economic recovery will enter three stages—short, medium, and long term.
“The framework will be simple. The vaccines will tell the world that it is safe to be in the Philippines. CITIRA [Corporate Income Tax and Incentives Reform Act] or CREATE [Corporate Recovery and Tax Incentives for Enterprises] will tell them it is rewarding to invest in the Philippines. RBH [Resolution of Both Houses] 2 will tell them they are welcome to invest in the country,” he said.
According to Salceda, the vaccine is the country’s immediate-term intervention.
“So we need to get it out fast, before anything else. The CITIRA will be the short-to-medium term fix for investor uncertainty and private sector sluggishness. Finally, RBH 2 will shake the dormancy out of our rent-heavy sectors,” Salceda said.
The lawmaker said Congress will pass the final version of CITIRA or CREATE this month.
“I expect CITIRA/CREATE to pass both houses by the end of this month. I have submitted my committee’s amendments to the Speaker for his final decision. I expect a discussion between the Senate President and the Speaker very soon,” Salceda said.
“The business community waited long enough, so I understand the frustrations of several groups. I just do not appreciate the tone that the House has not acted quickly upon the bill. First of all, the House approved the bill in September 2019. So, no intention to delay at all. Second, I vowed the House will immediately approve a fiscally responsible version. CREATE gives 17 years of incentives to domestic investors, when the current system only gives 6 years maximum,” Salceda added.
He, however, said a speedy vaccine rollout will be the “cornerstone of economic recovery.”
“CREATE/CITIRA will be useless without quick vaccine rollout. We will be wasting government revenues unless we rollout the vaccines quickly,” Salceda said.
“If we face delays on vaccine rollout, the recovery will also be delayed. If we vaccinate faster than planned, recovery will be faster than expected. It is really very simple,” he added.
Meanwhile, Salceda said RBH 2, on the other hand, is the strongest signal the country could ever send to the world that the Philippines is open for business.
“Actually, if you were to ask me, I would say RBH 2 is a thousand times more important than CITIRA. The problem with FDI [foreign direct investments] isn’t so much that we don’t give enough incentives. We do. The current investment priorities plan probably covers 70 percent of GDP. And we’re the only Asean country to give forever incentives through the gross income earned [GIE] incentive,” he added.
‘No more delay’
For his part, Deputy Speaker Rufus Rodriguez on Tuesday opposed the call of Sen. Franklin Drilon for the House of Representatives to postpone its economic Cha-cha push to the latter part of 2022.
“I welcome Sen. Drilon’s openness to economic reform in the Constitution, but I am against his suggestion that we delay working on it by almost two years,” the representative of Cagayan de Oro’s second district said.
