LAST July 11, 2024, I was one of the panelists at the 11th PICPA-Cebu Summit, where I discussed the pending House Bill 4339 or the Passive Income and Financial Intermediary Taxation Act Bill (PIFITA), which seeks to reform the taxation of capital income and financial services. Approved on third and final reading by the House of Representatives on Nov. 14, 2022, the PIFITA was a welcome development that recently, hearings on the PIFITA Bill at the Senate Ways and Means Committee have resumed.
In terms of capital markets, the Philippines lags behind its neighbors. Among the factors identified to be the reason for this are our high taxes and complicated tax structure. Studies have shown that Philippine taxes on transactions are high and are almost certainly restricting volume and liquidity.
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