Thea Alberto-Masakayan, ABS-CBN News

<figure class="op-social"><iframe allowfullscreen="" frameBorder="0" height="350" src="https://www.youtube.com/embed/Tz4YBFBV5Ss" width="600"></iframe></figure>MANILA - The incoming chief of the finance department has vowed to review the Philippines&#x27; tax system, which has seen little changes over the past 20 years.Carlos &quot;Sonny&quot; Dominguez cited the need to review the Bureau of Internal Revenue&#x27;s (BIR) tax brackets which are used as bases for paying income taxes.He said these are now outdated and have become &quot;inequitable.&quot;&quot;In the tax reform area, we are looking definitely at reviewing all the tax brackets in place for nearly 20 years and these tax brackets have been eaten up by inflation and [have] become inequitable so we are going to review tax brackets,&quot; Dominguez said Friday in ANC&#x27;s Market Edge with Cathy Yang.Dominguez said changes might include returning to ad valorem tax on fuel products, where taxes are based on the selling price or value of goods or transaction, rather than on volume.&quot;Obviously, a tax reform package will look at areas like changing back to ad valorem in fuel and looking at more efficient tax collection, customs collection,&quot; Dominguez said.He said President-elect Rodrigo Duterte&#x27;s administration is also looking at options to bring down tax rates while broadening the tax base.&quot;In the first place, we&#x27;re looking for an equitable tax regime and hopefully, we will be able to achieve a lowering of the tax rate but broadening the base,&quot; said Dominguez.He said Duterte&#x27;s tax reform package might be presented and prepared for legislation in September.Filipino workers pay the highest income tax in the Association of Southeast Asian Nations region, according to a study by the Tax Management Association of the Philippines in 2014.Dominguez said last month that the new administration plans to <a href="http://news.abs-cbn.com/halalan2016/business/05/12/16/duterte-wants-tax-reform-davao-model-for-economy">overhaul the income tax</a> system, which would effectively lower the tax burden.He said they would adjust income tax brackets to current inflation rate. With a &quot;progressive&quot; system, &quot;the tax bite should be lower&quot; for some, he said.&quot;These tax tables were made many years ago when P500,000 meant more than what P500,000 means now,&quot; Dominguez said.The outgoing administration has proposed to Duterte a comprehensive tax reform package which includes increasing value-added tax (VAT) from 12% to 14% and bringing down corporate income tax from 30% to 25% in five years.READ: <a href="http://news.abs-cbn.com/business/05/24/16/duterte-urged-to-raise-vat-to-14-pct-include-seniors">Duterte urged to raise VAT to 14 pct, include seniors</a>A <a href="http://news.abs-cbn.com/business/06/01/16/14-pct-vat-not-the-solution-says-finex-exec">Finance Executives of the Philippines</a> (FINEX) official, however, said a 14% VAT may not be a good tack, suggesting instead that the new government should just focus on simplifying payment of taxes and making the rates in line with the country&#x27;s Asian neighbors.Meanwhile, Dominguez said he does not intend to change the macro-economic policies of previous administrations.&quot;Through these administrations, the Philippines has definitely progressed in the economic field and actually, the administration that pushed the envelope further was the administration of President Noynoy Aquino,&quot; said Dominguez, citing the Aquino and Arroyo administrations.

MANILA - The incoming chief of the finance department has vowed to review the Philippines' tax system, which has seen little changes over the past 20 years. 

Dominguez mulls return to ad valorem tax on fuel

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Dominguez mulls return to ad valorem tax on fuel

Thea Alberto-Masakayan,

ABS-CBN News

Published Jun 03, 2016 08:09 PM PHT

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Updated Jun 03, 2016 09:16 PM PHT

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