Palace open to lower income tax rates

MANILA, Philippines - Malacañang said Wednesday that it is open to proposals to lower the prevailing income tax rates.

Communications Secretary Herminio Coloma Jr., however, could not say yet if the pending Senate bill reducing income tax rates is among President Aquino's priority measures.

"Government is open to consider proposals on changing the income tax rates and continues to work with Congress on this matter," Coloma said in a press briefing.

Coloma said the Department of Finance DOF is advocating a comprehensive review of the existing taxation system so that needed reforms may be instituted.

Quoting Finance Secretary Cesar Purisima, Coloma said the DOF prefers a "holistic review of the tax structure so as not to put our fiscal gains and fiscal health at risk."

"It is also important to identify new and additional sources of tax revenues that will offset any reduction in collection of income taxes," Coloma also said.

Coloma made these statements after Sen. Francis Escudero urged President Aquino to send to Congress a legislation lowering personal income taxes or simply certify as urgent one of the pending proposals in Congress.

Escudero said a "presidential certification will make the bill a priority measure and veto-proof."

"The reality is that the input of the president is critical when it comes to tax measures," said Escudero, the former chair of the Senate Committee on Finance.

The senator said Aquino should not let the opportunity pass to bring down "one of region's highest individual income tax rates."

"Years from now, when the president goes back to Times Street, he should not look back with regret that he squandered the opportunity to lower the income taxes to their compassionate levels," Escudero said.