The Department of Finance (DoF) said a number of inherently profitable multinationals continue to enjoy tax incentives even as the agency identified at least 645 registered enterprises that receive tax breaks even after 15 years in the business. The DoF said the data prove the fiscal incentives have become redundant and unnecessary.

Finance Undersecretary Karl Kendrick Chua said data reported by investment promotion agencies (IPA) as mandated under the Tax Incentives Management and Transparency Act also show that for 2015 alone, the government gave away P86 billion-worth of income tax incentives to firms that paid out a total of P83 billion combined in dividends.

So our question is, why are we supporting certain firms if they are inherently profitable and they pay even more dividends than the incentives they receive? Dividends are just a fraction of profit, said Chua during a recent hearing on the proposed corporate tax reform law conducted by the House ways and means committee.

The committee, chaired by Rep. Dakila Carlo Cua, has so far conducted five hearings on House Bill 7458, which aims to lower corporate income tax while reorienting the current complicated investment incentives system that has led to such redundant, unnecessary perks given out to select enterprises registered with the Board of Investments, Philippine Economic Zone Authority and 12 other IPA.