Comprehensive Tax Program (CTRP)

May 17,2019 11:27 AM

The Comprehensive Tax Program (CTRP) accelerates poverty reduction and sustainably ad-dresses inequality to attain tax system that is simpler, fairer and more efficient. It will provide additional and a more sustainable stream of revenues needed to make meaningful investments for our people and infrastructure to achieve our vision for the Philippines.

The Vision of CTRP aims to achieve the following:

By 2022
• Poverty rate reduced uplifting millions of Filipinos from poverty
• Law abiding country
• Peace within the country and our neighbors
• To graduate to upper middle income country status from the current low middle income country status. 

By 2040
• Eradicate extreme poverty
• Inclusive economic and political institutions where everyone has equal opportunities
• Achieve high-income country status

Comprehensive Tax Program (CTRP) Packages

Package 1: TRAIN

Republic Act No. 10963 or Tax Reform for Acceleration and Inclusion (TRAIN) lowers and simplify personal income, estate and donor’s taxes, expanding the value-added tax (VAT) base, ad-justing oil and automobile excise taxes, and introducing excise tax on sugar-sweetened beverages.

Package 1B: Tax Amnesty

As a complimentary measure TRAIN Package 1B or the Tax Amnesty Bill includes the lifting of bank secrecy laws and automatic exchange of information and three types of amnesties (on estate tax, all unpaid internal revenue taxes with the corresponding waiver of bank secrecy laws in the availment thereof, and delinquencies). There are also proposals on other amnesty taxes such as importation taxes and customs duties.

Package 2: TRABAHO

TRABAHO seeks to make the corporate tax system simpler, fairer, and more transparent. It lowers the corporate income tax (CIT) rate from 30% to 25% for a large majority of businesses and modernized fiscal incentives, so that these are given to investors who make positive con-tributions to society. This will correct some of the most glaring inequities and inefficiencies in our corporate tax system.

Package 2+: Mining and sin taxes

Package 2+ of the Comprehensive Tax Reform Program includes proposed reforms on mining and sin taxes. For mining, the proposal is to implement a single fiscal regime applicable to all mineral agreements to promote fairness. For sin taxes, Package 2+ proposes to further in-crease the excise tax on both alcohol and tobacco products to provide additional funding for Universal Health Care (UHC).

Package 3: Property valuation and Taxes

Package 3 of the CTRP aims to introduce vital reforms to promote the development of a just, equitable, and efficient real property valuation system. The reforms will broaden the tax base used for property and property-related taxes of the national and local governments, thereby increasing government revenues without increasing the existing tax rates or devising new tax impositions.

Package 4: Capital Income and Financial Taxes

Package 4 of the CTRP is about reforms on capital income and financial services taxation, which aims to make the taxation of the sector simpler, fairer, and more efficient. Specifically, it reviews the taxes imposed on financial intermediaries and the products they offer: on savings and investments; and debt and equity instruments.

Tax reform will allow the government to invest in the people through infrastructure, educa-tion, health, housing and social protection. With the tax reform, we can further strengthen our macroeconomic position to create an environment more conducive to high growth and in-vestment, good job creation, and faster poverty reduction.

Source: Department of Finance