Biz group says Bukidnon needs updated tax codes to draw investments

MALAYBALAY CITY (MindaNews/01 May) – Bukidnon needs to reform its tax codes if it wants to attract more investors to the province, a business chamber official said.

“At the start of the day, you are supposed to put up signage saying Bukidnon is ready for investments, but you cannot (because of obsolete tax laws and other policies),” Roderico Bioco, president of the Bukidnon Kaamulan Chamber of Commerce and Industry Inc. (BKCCII) said.

He said promoting investments is good but should be backed by a correct policy environment.

“If investors (check on government’s) due diligence; we can only get very brave investors, but they are not as aggressive,” he said, adding Bukidnon is not the only investment destination.

Bioco spoke at the 19th Strictly Business News Conference at the Department of Trade and Industry-Bukidnon office on April 23.

The chamber announced the holding of a forum mapping out Bukidnon’s top commodities aside from rice, corn, and sugar. He said the province also produces rubber, abaca, cacao, cassava, oil palm, and banana.

He said it is important to lay out the value chain of these commodities to draw out an investment plan to support and promote them to possible investors.

But he said no investment promotion will work without a favorable business environment.

Bioco cited that the tax codes of Malaybalay and Valencia City needs to be updated.

Malaybalay, which became a city in 1998, is still using a tax code based on Presidential Decree 236, an earlier version of the Local Government Code of 1991, he said.

He said such law computes taxes based on gross sales. “But gross sales/receipts may include Value-added tax (VAT). You cannot tax a tax,” he said, adding PD 236 was imposed when there was no VAT yet.

He cited the case of the trucking industry, where he is one of the players, which is also excluded from the tax computation based on gross sales. “Only the provincial government can tax on trucking. Even with that, they can only tax per unit, not on gross receipts.”

These updates, he added, should be included in local tax codes.

Lawyer Roland F. Deticio, Malaybalay City vice mayor, said via telephone last Saturday that proposed amendments to the revenue tax ordinance, including the question on gross sales, were “under study.”

He said they plan to pass the revised ordinance this year so the new rules could become effective in January 2016. He said they were able to implement revisions in real property tax in January this year.

Bioco said the tax codes of Bukidnon’s 20 towns possibly carry the same defect as that of the two cities.

He said that while the provincial government had passed last year its own investment code, “there is disengagement” at the local level, referring to the towns and cities.

“Even if you expedite the business registration/licensing process, you’ll get stuck in the tax computations,” he said, noting this has been an issue every year between tax payers and local governments.

Bioco said the chamber and the Department of Trade and Industry and the Department of the Interior and Local Government have signed a memorandum of agreement on how to address the problem.

For example, he said, they will hold a conference among local treasurers, assessors, planning and development officers on the need to reform local tax codes.

He said they consider it an appropriate step before pushing for the legislation of new local tax codes.

He said DTI and DILG wanted to institutionalize changes through business chambers like BKCCII.

He added that aside from updating local tax codes his group is also campaigning for reforms in business permit processing and zoning ordinances, among others. (Walter I. Balane/MindaNews)