ACTING Socioeconomic Planning secretary Karl Kendrick Chua called for the passage of three bills to support the government’s Covid-19 economic recovery program in the online “Sulong Pilipinas” conference last May 14.
The Philippine Program for Recovery with Equity and Solidarity, or “PH-Progreso,” consists of three stages: the emergency stage, the current stage, the recovery stage and the resiliency stage.
“The whole idea of this program is we try to turn the crisis into an opportunity,” he said.
Chua compared the state of the country to an “incubated patient in the ICU (intensive care unit),” revived by the “Bayanihan to Heal as One Act” through subsidies and healthcare support.
The government wants Congress to pass three bills to prepare for the recovery stage, which is projected to start in June, he said.
The first bill, called “Bayanihan II,” is a continuation of the previous Bayanihan law, and will focus on spending and capital support through the restoration of income and jobs.
“In order to stimulate consumption, health system capacity and infrastructure must be prioritized to restore confidence among consumers so that they won’t get sick when they go outside,” Chua said.
The bill will also prioritize the food and agriculture industry and restart key “Build, Build, Build” projects, provided that all of them adhere to health standards.
Micro to large firms will benefit from the second bill called the “Corporate Recovery and Tax Incentives for Enterprises” or Create.
The bill proposes an “across-the-board” reduction of the corporate income tax rate to 25 percent from 30 percent, and the extension of the net operating loss carryover, a tax asset deductible from business income, to five years from three years.
The third bill, the 2021 General Appropriations Act or the national budget for next year, will support healthcare, infrastructure, food and agriculture and “new normal” policies, Chua said.
‘Highs and lows’
The country’s gross domestic product contracted by 0.2 percent in the first quarter due to strong lockdown measures intended to protect communities.
But Finance Secretary Carlos Dominguez III said the economy was resilient, and should bounce back from the health crisis brought on by the Covid-19.
“We need to focus on a smart combination of fundamental reforms and recovery measures to help ensure that we get the country back on its positive growth trajectory,” he said.
“Conservative” economic policies and tax reforms such as the Tax Reform for Acceleration and Inclusion (Train) law kept the country’s financial position strong, and more able to respond to the pandemic, he added.
Dominguez also stressed the importance of restarting the “Build, Build, Build” infrastructure program to boost the economy and provide jobs.
“The main problem of our economy now is liquidity. People, because they have not worked, have no cash,” he said.
He also recommended the mass hiring of contact tracers to lower risk of infections, and attracting foreign investors via the passage of the Corporate Income Tax and Incentives Rationalization Act (Citira) that will include flexible incentives.
Other priority measures include the promotion of manufacturing of products with strong, inelastic demand such as food production and logistics to stimulate demand, and support for entire value chains, from inputs to packaging and logistics.
“We need to help businesses, especially micro, small, and medium enterprises, and consumers weather the economic storm together,” Dominguez said.
Sulong Pilipinas is the annual consultative conference between the government and various citizen groups.
This year’s conference was held via Zoom, and was attended by members of the youth sector hailing from different universities and organizations all over the country.
Last year’s Sulong Pilipinas was hosted by the University at the Thomasian Alumni Center, and tackled the Duterte administration’s Comprehensive Tax Reform Program.
