House ways and means panel approves BBL tax provisions

THE House of Representatives ways and means committee has approved the fiscal provisions of the proposed Bangsamoro basic law (BBL) that would grant the Moro region its power to collect taxes within its territory.

In an interview on Tuesday, ways and means panel chairman Marikina Rep. Romero “Miro” Quimbo said the approved tax provisions are nothing new because these were already included in the Autonomous Region in Muslim Mindanao (ARMM) law, or Republic Act 9054 which created the ARMM that the new Bangsamoro region will replace.

“Ang ibig sabihin lang nito, nire-recognize ang fiscal autonomy ng bagong autonomous region. Ang importante rito, the taxing power or privilege we’re granting here is 95 percent already granted by the ARMM law,” Quimbo said.

The proposed BBL will replace and repeal the ARMM law.

During its hearing on Monday, the ways and means committee approved the provision allowing the Bangsamoro government to retain all national government taxes, fees and charges collected in the Bangsamoro region for the first 10 years.

Thereafter, the Bangsamoro government will have a 75 percent share on the national government collections in the region, while the national government will have a 25 percent share. This is an increase of share for the Bangsamoro from the current 70-30 percent share.

Quimbo said because of the five percent increase in the national government collections share, the Bangsamoro would receive an additional P2.9 billion in the national collections or an eight to nine percent increase from its usual share.

Moreover, the committee also amended the bill to compel corporations, partnerships and firms operating in the Bangsamoro whose headquarters are outside the Moro region to pay income tax to the Bangsamoro government. The original provision wanted the businesses to pay taxes to the city or municipality where the branch offices are located.

Quimbo said this provision promotes social justice because in the current set-up, companies based in the ARMM pay taxes in Metro Manila and not to the Moro region revenue service.

“That is in fact one of the major sources of inequity… Kaya hindi umuunlad ang Bangsamoro, kasi napakaraming plantation sa Bangsamoro, pero in terms of payment of taxes of companies who own these plantations, napupunta sa Makati,” Quimbo said.

The panel likewise approved the provision allowing the Bangsamoro government to grant tax exemptions, rebates, tax holidays, and other incentives to encourage investments in the region. But it deleted the line imposing a flat rate lump sum tax on small and medium enterprises.

Other forms of levy are documentary stamp tax, donor’s tax, estate tax, taxes on banks and registration of vessels, tolls on bridges, among others.

Finally, the panel amended the provision allowing the Bangsamoro powers to levy capital gains tax to be imposed on gains from sales of real property and shares of stocks and other disposition of capital assets.

The powerful ways and means committee tackle bills that deal with revenue generation through taxation.

The House is set to vote for the passage of the proposed Bangsamoro law that would create a more politically autonomous Bangsamoro region to create the Autonomous Region in Muslim Mindanao.

This after the ad hoc Bangsamoro committee passed on first reading a version of the bill approved by Malacanang, triggering criticisms that the panel railroaded a mostly Palace version of the bill that seeks to implement a government peace deal with the Moro Islamic Liberation Front. AC