PH needs to expand tax base for sustainable, inclusive growth: World Bank economist

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MANILA -- The Philippines must expand its tax base to make growth more sustainable and inclusive, a World Bank official said Wednesday. Speaking on ANC&#x27;s Market Edge, World Bank Senior Economist Ralph Van Doorn said the Philippines must think about increasing its revenue.&quot;It’s still far below that of other middle-income countries,&quot; he said. Van Doorn said the tax policy measures in the country&#x27;s pipeline are important, but they may not be enough.&quot;So for the Philippines, really, core to think about what else could be done to broaden the tax base to make sure there are fewer exemptions, whether through incentives or through a (value-added tax), which tend to benefit richer households, to benefit firms that are highly profitable anyway.&quot;The economist noted that the global tax environment is moving towards a global minimum tax of 15 percent. <ul class="op-related-articles">	<li><a href="https://news.abs-cbn.com/business/06/07/21/global-minimum-tax-meaning">What is a global minimum tax and what will it mean?</a></li></ul>&quot;It means that certain tax incentives will become less useful like tax holidays, which means , maybe a company will pay no tax for 5 years, they will be less prevalent in may countries,&quot; he said.&quot;Because if you offer a tax holiday to a company, the home country of that company is going to be able to tax them anyway, so another country is going to take away your tax base if you don’t repair your tax base yourself,&quot; he explained. Beyond expanding the tax base, the Philippines must also create more high quality jobs to make growth more sustainable, Van Doorn said.&quot;The high value added-services are still not accessible to a large part of the labor market. We see that--people going in the labor market with medium skills and in the low value-added services. Now high value-added services actually have a lot of productivity potential, but not only that, they can actually also create more productivity in other sectors,&quot; he said. Van Doorn also said this will keep the Philippines on a fairly low-carbon emissions path compared to many neighboring East Asian countries.In November, National Statistician Dennis Mapa said the decreasing number of Filipinos in elementary occupations is a good indicator that the quality of jobs is improving in the Philippines.<ul class="op-related-articles">	<li><a href="https://news.abs-cbn.com/business/11/08/23/jobless-rate-slightly-rises-underemployment-dips-in-september">Jobless rate slightly rises, underemployment dips in September</a></li></ul>The Philippines&#x27; unemployment rate rose slightly to 4.5 percent in September.The World Bank said it expects the Philip[pine economy to grow by 5.6 percent in 2023, and 5.8 percent in 2024.<ul class="op-related-articles">	<li><a href="https://news.abs-cbn.com/business/10/02/23/ph-growth-seen-at-56-pct-this-year-among-fastest-in-region">World bank sees PH growing 5.6 pct in 2023, among fastest in region</a></li>	<li><a href="https://news.abs-cbn.com/business/12/05/23/world-bank-sees-ph-economy-growing-58-percent-in-2024">World Bank sees PH economy growing 5.8 pct in 2024 as inflation eases</a></li></ul><div>--ANC, 6 December 2023</div>

The Philippines must expand its tax base to make growth more sustainable and inclusive, a World Bank economist said. 

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PH needs to expand tax base for sustainable, inclusive growth: World Bank economist

PH needs to expand tax base for sustainable, inclusive growth: World Bank economist

ABS-CBN News

Published Dec 06, 2023 03:41 PM PHT

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Updated Dec 06, 2023 06:28 PM PHT

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World Bank

economy

Philippines

sustainable growth

inclusive growth

jobs

quality of jobs

employment

unemployment

tax

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