Less than 3,000 firms took P301B tax perks in 2015
It’s not worth it if you do the math.
The Department of Finance (DOF) had numbers to defend their proposal to trim tax incentives given to companies in the Philippines.
The DOF found that the government gave away P301 billion worth of tax perks in 2015, which was enjoyed by 2,844 firms.
In contrast, 800,000 businesses — most of which are small firms — had to pay the flat-rate corporate income tax at 30 percent of revenues.
“A cost-benefit analysis done by the DOF using available data show that many incentives enjoyed by enterprises registered in IPAs (investment promotion agencies) are unnecessary as the country is losing than getting back more in terms of economic benefits such as jobs, exports and productivity,” Finance Undersecretary Karl Chua said.
“We want investment incentives to stay but these should be based on performance, are targeted, transparent and not given out forever.”
This is the first time when an analysis of fiscal perks was made following the passage of the Tax Incentives Management and Transparency Act.