MANILA -- The House of Representatives ways and means committee on Wednesday approved the fourth comprehensive tax reform program, which introduces reforms on financial taxes and is being pushed by the Duterte administration.
The panel, chaired by Nueva Ecija Rep. Estrellita Suansing, approved an unnumbered substitute bill titled "Passive Income and Financial Intermediary Taxation Act of 2019”.
The bill aims to make the tax system for capital income and financial intermediation simpler, fairer, more efficient, and regionally more competitive.
It also seeks to harmonize the country's current 80 financial tax rates to 41 in order to deepen the local capital markets.
Furthermore, it shall unify tax rates for interests, dividends, and capital gains.
Under the bill, a final tax at the rate of 15 percent, from 20 percent, shall be imposed upon the amount of interest, yield, or any other monetary benefit earned or received from debt instrument, bank deposit, deposit substitute and any other form of debt instrument and similar arrangements.
A final tax rate of 15 percent shall be imposed upon the cash and/or property dividends actually or constructively received by an individual from a domestic corporation or from a joint stock company, insurance, mutual fund companies, collective investment schemes and regional operating headquarters of multinational companies, or on the share of an individual in the distributable net income after tax of a partnership (except a general professional partnership) of which he is a partner, or on the share of an individual in the net income after tax of an association, a joint account, or a joint venture or consortium taxable as a corporation of which he is a member or co-venturer.
The bill said a final tax at the rate of 15 percent is hereby imposed upon the net capital gains realized during the taxable year from the sale, barter, exchange or other disposition of shares of stock in a domestic corporation, except shares sold, or disposed of through a local or a licensed organized marketplace. (PNA)
