With the first package of the Tax Reform for Acceleration and Inclusion (TRAIN) program of the administration already made into law, the Department of Finance (DOF) is setting its sight on the second package which aims to give the finance secretary the authority to rationalize the grant of income
tax holidays and other perks to industries.
MANILA, Philippines - Income
tax holidays and other perks enjoyed by large corporations cost the government over P300 billion in foregone revenue annually, according to the Department of Finance (DOF).
In particular, the concept of
tax holidays, which are provided to conscientious taxpayers faced with temporary financial difficulties for a period of up to twenty four months from the date of the relevant decision, appeared in the country's legislation for the first time.
Income
tax holidays and other incentives with no time limits enjoyed mostly by large businesses is costing the government over P300 billion annually in foregone revenues, according to the Department of Finance (DOF).
The Governors proposal includes sales
tax holidays to help families prepare for the school year and hurricane season, and reductions to many of the fees on drivers licenses.
Texas already has
tax holidays for two other kinds of products: school supplies and energy-efficient appliances.
To help gin up sales, many stores roll out discounts and some states even get in on the act, offering sales
tax holidays for clothing, backpacks, even computers.
The Department of Excise and Sales Tax, AJK has proposed to the government for the withdraw of notification about the
tax holidays, they added.
The Federal Board of Revenue has received three tax policy proposals from the Board of Investment (BoI) for fixation of an investment threshold to grant
tax holidays to foreign investors, reduction in corporate income tax rate and cut in the standard rate of 17 percent sales tax.
As part of Ireland's accession the European Economic Community, precursor to the European Union, in 1973, it was forced to stop offering
tax holidays to exporters.
Sales
tax holidays are popular with consumers and have broad support among lawmakers, who have supported them to improve sales for retailers, help low-income consumers save money and promote economic growth.
One of the considerations that pushed the creation of Act 757 was concern that Arkansas shoppers were taking advantage of
tax holidays in neighboring states.
