RP to trim tax facility

RP to trim tax facility

Philippine Finance Secretary Jose Isidro Camacho has ordered the
trimming of tax exemptions and incentives granted by government
agencies in an effort to bolster the government's sagging
revenues, it was announced here Sunday.

The incentives and exemptions, granted to attract prospective
investors to this country, is "an issue we have to deal with,"
Camacho was quoted as saying.

All agencies will be asked to harmonize their tax incentives,
the department said, adding that the internal revenue bureau
would tighten its controls as well.

The department did not say how much was being lost to these
incentives and exemptions although some estimates have placed it
at about 4.2 billion pesos (US$82.4 million) a year.

The International Monetary Fund (IMF) last week warned that
the Philippines must rein in its budget deficit to achieve its
projected growth targets for this year.

The Philippines is targeting a budget deficit of 130 billion
pesos for 2002 but the deficit has already soared to 82.9 billion
pesos in the four months to April alone.

Government officials have attributed this to poor revenue
collections and accelerated spending in the first months of the
year. -- AFP