LGUs overtaxing businesses – NCC
Local government units (LGUs) are overtaxing businesses, the National Competitiveness Council (NCC) said yesterday.
In a press conference, NCC chairman Ambassador Cesar Bautista said the insurance and liabilities tax imposed on businesses by LGUs is an example of overtaxing.
“The businesses are overtaxed by LGUs,” Bautista told reporters. “This (liability insurance) is not necessary. It should be removed,” he added.
According to Bautista, at least five cities in Metro Manila have started imposing this particular tax last year.
Bautista explained that this kind of tax is not needed, especially by small businesses.
He said this tax acts as a third party insurance for the consumers of an establishment in case an accident happens.
For instance, this tax can be used to ensure that the victims of the incident in the Ayala-owned Glorietta mall last October will be protected and well compensated. Last year, there was an explosion in Glorietta 2 which killed eight people and left hundreds injured.
The Philippine Chamber of Commerce and Industry (PCCI) has complained about the tax.
“They are complaining that it is expensive and that the LGUs are not clear as to what this thing is about,” Bautista noted.
Bautista said they will sit down with the Department of Interior and Local Government (DILG) in order to address this particular problem.
Another problem of businesses, this time voiced out by the American Chamber of Commerce (Amcham), is the issue of business permits.
Bautista said it takes LGUs an average of 90 to 120 days to process permits. He said the ideal processing time should only be one week.
He said other more efficient cities have managed to reduce the processing time.
“Why can’t the others do it,” he asked.
To address this, Bautista said he will be conducting a seminar with LGUs and have the more efficient cities give talks and tips on how they were able to improve their operations.
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