29.5 C
Cagayan de Oro
Saturday, April 13, 2024
HomeThe RegionBARMMProposed Bangsamoro Revenue Code advances to second reading

Proposed Bangsamoro Revenue Code advances to second reading

COTABATO CITY — Before adjourning sine die on February 29, the Bangsamoro Parliament advanced a measure proposing the creation of the Bangsamoro Revenue Code (BRC) to its second reading.

The 11-title revenue code, filed by the Government of the Day, seeks to regulate the levy, assessment, and collection of all regional taxes, fees, and charges, as well as the administration of other regional revenue sources and tax expenditures within the BARMM.

The proposed revenue code addresses regional taxes, fees, and charges; the treatment of national taxes with situs in the region; Islamic finance; other revenue resources; tax incentives; offenses and penalties; and remedies.

In a speech by the Minister of Finance, Budget, and Management (MFBM) and Member of Parliament, Atty. Ubaida Pacasem, as delivered by Deputy Floor Leader Atty. Mary Ann Arnado, the authority granted the Bangsamoro government to impose and collect certain national taxes.

The fiscal framework’s crafting aims to optimize fiscal autonomy granted by the Bangsamoro Organic Law (BOL), reduce reliance on intergovernmental fiscal transfers, increase revenue-raising capacity, and align with the region’s development priorities.

Pacasem said that additional taxing powers granted by the BOL, such as capital gains tax, documentary stamp tax, estate tax, and donor’s tax, are seen as positive outcomes of the Bangsamoro’s commitment to the peace process.

The proposed code also seeks to establish the Bangsamoro Revenue Office, responsible for collecting and assessing the mentioned taxes, functioning not only as the administrator of regional taxes but also authorized to collect other national taxes.

Collaboration with the Bangsamoro’s peace negotiators and BOL framers led to settling taxable elements and delineating the functions of the BRO and the Bureau of Internal Revenue.

Pacasem expressed confidence that the BRC would contribute to the Bangsamoro’s aspiration for self-determination, as revenue sources ensure genuine autonomy.

He cited examples of the key tax bases with major revenue potential remaining with the national government, while taxes on business activities and privileges are shared across levels of government.

He said that the response to this challenge is to capture tax revenue from less subject-matter, market-seeking, and resource-seeking activities of enterprises.

Citing the region’s natural resources, Pacasem said that resource rents, non-tax fees, and charges imposed by the Bangsamoro government have the potential to contribute to the fiscal autonomy and sustainable development of BARMM.

With a significant Muslim population in the country, Pacasem highlighted the importance of financial inclusion through Islamic finance, stating that it would be incomplete without the Bangsamoro. The BRC outlines the policy and scope of Islamic finance and its principles.

The Bangsamoro Government, in accordance with Section 14 of the Islamic Banking Act and Section 32 of the BOL, is establishing a tax regime to promote the growth of Islamic banking and finance within the BARMM.

The code aims to create a level playing field for Islamic finance products and services in the region, ensuring a sustainable Islamic finance industry.

In addition to revenue generation, Pacasem noted that the BRC incentivizes social objectives through measures like a social amelioration tax to discourage certain activities like gambling, taxes on single-use plastics, and fees and charges on environmental impact assessments, toxic substances, and nuclear waste permits.

The Bangsamoro Government is authorized, according to Government Bill No. 286, to accept donations, contributions, grants, bequests, or gifts from domestic or foreign sources, aligning with the Bangsamoro Development Plan or priorities of the government, subject to clearance or approval from the president or authorized representative.

Pacasem said that the region should no longer be dependent on the block grant provided by the national government.

“We have to find sources and tap the potential of our region,” said Pacasem, highlighting the need for the Bangsamoro government to explore alternative revenue streams.

The Bangsamoro region has relied on a block grant from the national government to fund its operations and development projects.

“We cannot be forever dependent on the block grant. We need to assert our fiscal autonomy to ensure the sustainable development of our region,” Pacasem emphasized.

He said that fiscal autonomy would allow the Bangsamoro government to earn revenue on its own, providing more flexibility in budget administration and strategic economic planning.

The revenue code is one of the remaining priority measures that must be passed by the interim government during the transition period. (LTAIS- Public Information, Publication, and Media Relations Division)


Most Popular

Recent Comments