ALBAY Rep. Joey Salceda obviously got irritated by policy disagreements among Cabinet officials on the Corporate Income Tax and Incentive Rationalization Act (CITIRA) during its recent deliberations at the House Ways and Means Committee which he chairs, and criticized them in no uncertain terms.
“I concede you have honest disagreements but please don’t use Congress as playground for your policy battles, or worse, use us as proxies or mercenaries for your skirmishes, because you are all alter egos of only one President,” he told the cabinet officials.
He urged the Cabinet officials to settle their issues with the President first and “avoid using Congress as playground for policy battles that generate confusions, send wrong signals, delay the legislation process and create uncertainties among investors.”
CITIRA, the second package of the administration’s Comprehensive Tax Reform Program, seeks to reduce the corporate income tax rate from 30% to 20% for some one million businesses in the country, and rationalize incentives for some 4,100 firms which pay only 5%. The President has designated CITIRA as the national response to the US-China Trade War. He endorsed it in January 2018 and sought repeatedly its congressional approval in consecutive SONAs.
The measure is projected to create 1.566 million jobs and incrementally expand the GDP by 3.6% annually. Some cabinet officials, however, lately proposrd to revise the transition period for the fiscal incentives, which snagged the bill’s passage.
“I appeal to our Cabinet members to settle their policy disagreements first with the President and within the Cabinet. I honestly feel Cabinet members are the ones sowing confusion, sending wrong signals and worst, delaying the legislative process and creating unnecessary doubts and uncertainties among investors,” he lamented.
Salceda crafted CITIRA in consultation with the Finance Department. After extensive studies “with the best data science and analytics, and simulations,” the House passed it in the 17th Congress but failed to hurdle the Senate due to time constraint. It has gone through two previous House Ways and Means chairpersons – Dax Cua of Quirino, and Estelita Suansing of Nueva Ecija, and now, Salceda. The House finally passed it last Tuesday.
Under the CITIRA, firms’ expenses on research and development, workers’ training, and infrastructures leading to their plants, will be 100% tax deductible. If they hire domestic workforce and source local inputs, they will get 50% more deductions.
