Tax relief for calamity-hit areas sought

MANILA, Philippines — Calamity-stricken areas should be given tax relief for a period of at least one year to enable affected businesses and families to recover from the loss of their financial resources, Sen. Paolo Benigno Aquino IV said.

Aquino has introduced Senate Bill 653 providing for exemption from payment of real estate, business and donor’s taxes.  

“This measure adds to the various initiatives of government, civil society and the private sector to strengthen our resilience to adversity and invigorate the spirit of bayanihan ingrained in the collective heart of Filipinos,” Aquino said in the explanatory note of his proposed measure filed recently.

“As we faced a number of terrible natural disasters in the past years, from super-typhoons to earthquakes and flashfloods, we saw the bayanihan spirit of every Filipino eager to give their time and resources to suffering Filipino families,” he said. 

The senator said the tax system needs to be re-evaluated to ensure quick and efficient recovery from disasters of calamity victims. 

“As such, this measure seeks to relieve our countrymen affected by terrible distress of the burden of taxes to encourage a quicker recovery,” Aquino said.

The proposed “Providing For Tax Relief in Times of Calamity” will make effective the exemption of payment of such taxes following the declaration of a state of calamity by the proper local Sanggunian or legislative body. 

In support of local entrepreneurs who provide for their families and generate jobs within their community through business, establishments affected by a calamity shall be exempted from tax payments for a period of one year after the calamity, he said.

He also called for the suspension of payment of real property tax in the calamity-stricken area for two fiscal years starting from the date of declaration of calamity.

Any donation in the name of any organization that declares that the funds donated shall be in favor of the victims of the calamity shall be exempt from donor’s tax, the bill said. 

The exemption from donor’s tax shall be applied automatically and the Bureau of Internal Revenue shall not require any accreditation requirements. 

The bill likewise safeguards donations to victims of calamities by allowing organizations exemption from donor’s tax, provided that at least 90 percent of the donations go directly to the affected community and not to administrative costs.