Mon Abrea, Harvard-trained tax expert and Chief Tax Advisor of the Asian Consulting Group (ACG), is calling on the newly elected Philippine lawmakers to expedite critical economic reforms that will not only attract foreign investors but also protect and support Micro, Small, and Medium Enterprises (MSMEs). Mr. Abrea emphasizes that MSMEs, which comprise over 99% […]
Mon Abrea, Harvard-trained tax expert and Chief Tax Advisor of the Asian Consulting Group (ACG), is calling on the newly elected Philippine lawmakers to expedite critical economic reforms that will not only attract foreign investors but also protect and support Micro, Small, and Medium Enterprises (MSMEs).
Mr. Abrea emphasizes that MSMEs, which comprise over 99% of Philippine businesses, are the backbone of the economy. However, they often face disproportionate tax compliance burdens that hinder their growth and competitiveness. To address these challenges, Mr. Abrea advocates for the following reforms:
- Revised MSME Classification: Increase the income and asset threshold for micro enterprises from P3 million to P50 million, and eliminate outdated and redundant bookkeeping requirements, as VAT taxpayers already file the Summary List of Sales and Purchases (SLSP) to the Bureau of Internal Revenue (BIR).
- 10% Flat Tax Rate for Small Businesses: Implement a simplified tax regime for small businesses with annual sales of P100 million or less, offering a flat tax rate with a minimum of P100,000 and a maximum of P10 million, without the need for extensive documentation or audits.
- Risk-Based Audits: Adopt a risk-based audit system that prioritizes higher-risk taxpayers, reducing the compliance burden on MSMEs and focusing resources on identifying large-scale tax evaders.
- Empowered Investment Promotion Agencies (IPAs): Grant more authority and autonomy to IPAs like the Philippine Economic Zone Authority (PEZA), allowing them to handle all government and regulatory requirements, including taxes, for Registered Business Enterprises (RBEs).
- Full Automation or Abolish the BIR: Implement full automation of tax administration or consider abolishing the BIR to address bureaucracy and corruption, thereby motivating voluntary compliance and attracting more foreign investors.
Mr. Abrea’s advocacy aligns with his previous contributions to tax reform, including his advisory role in the amendment of the Corporate Recovery and Tax Incentives for Enterprises to Maximize Opportunities for Reinvigorating the Economy (CREATE MORE) Act where he proposed the creation of a separate VAT Refund Center and electronic tax refund system. ACG played a significant role in shaping provisions that prioritize transparency and benefit businesses across industries.
“The proposed reforms are essential for creating a business-friendly environment that supports MSMEs and attracts foreign investment,” said Mr. Abrea. “By simplifying tax compliance and empowering IPAs, we can foster economic growth and job creation.”
ACG continues to engage with policy makers and stakeholders to advocate for these reforms and ensure their swift implementation.
For media interview, please contact Rafael James Suarez, Asian Consulting Group Executive Assistant:
Email: hp.gca@leafar
Phone: 0917-116-9864
Spotlight is BusinessWorld’s sponsored section that allows advertisers to amplify their brand and connect with BusinessWorld’s audience by publishing their stories on the BusinessWorld Web site. For more information, send an email to moc.enilnodlrowb@enilno.
Join us on Viber at https://bit.ly/3hv6bLA to get more updates and subscribe to BusinessWorld’s titles and get exclusive content through www.bworld-x.com.
Leave a comment