Foreign business groups expect reduced corporate tax rates to attract more investments to the Philippines, as they support the immediate passage of legislation reducing such tax and rationalizing tax incentives.

European Chamber of Commerce of the Philippines (ECCP) president, Nabil Francis, said the proposed Comprehensive Income Tax and Incentives Rationalization Act (CITIRA) should be “passed quickly.”

“We are in support of those key reforms agenda of the government. What is important is to fast-track because we are moving well (with) so-called competitors, the neighboring countries are ready. And they are moving very quickly. We would like the Philippines to become the future magnet for foreign investments,” Francis said in a press briefing Thursday on the sidelines the Arangkada Philippines Forum 2019.

The second package of the comprehensive tax reform program, CITIRA reduces corporate income tax from 30 percent to 20 percent over 10 years.

Francis said the chamber’s members intend to determine the future fiscal regime of the Philippines with the passage of the legislation.

“Because of the (pending) CITIRA bill, we have a bit of uncertainty. In general, investors, they don’t like uncertainty,” he said in an interview.

The ECCP has more than 700 members, 60 percent of them are European companies that have invested in the Philippines.

Julian Payne, president and chief executive officer of the Canadian Chamber of Commerce of the Philippines, considered the tax bill as “very comprehensive.”

“We strongly support reduction of it to 20 percent, which is the Asean average, (but the) real question now is how quickly it happens,” he said.

However, Payne said rationalizing incentives should take into account the incentive regime of Asean neighbors, particularly Indonesia, Malaysia, Thailand, and Vietnam.

Celeste Ilagan, director of the Philippine Association of Multinational Companies Regional Headquarters, Inc., shared the view that the rate of corporate income tax reduction in the country is slow.

“But definitely, we support the reduction of corporate income tax,” she said.

Apart from the passage of the CITIRA, Francis said the government’s “Build, Build, Build” infrastructure program will also be key in attracting more foreign investors to the Philippines. (PNA)