SCUTTLEBUTT

Divine congregation

A veritable assembly of industry captains attended the conferment of the highest honor given to a layperson by the Pope, awarded to retired Chief Justice Artemio Panganiban.

Among those present at the ceremony held at the Manila Cathedral on 16 September were industrialists Fernando Zobel de Ayala, Ramon Ang, sugar baron Jose Mari Chan, former Senate President Franklin Drilon, Chief Justice Alexander Gesmundo, and members of prominent families.

Manila Archbishop Jose Cardinal Advincula, who conferred the papal award, lauded Panganiban for being an “exemplary layperson.” Many were left wondering why such a powerful group gathered for Panganiban’s Vatican recognition.

The retired chief justice explained that it was due to the pivotal role of the magnates in the retrofitting, restrengthening, restoration, and renovation (the “four Rs”) of the Manila Cathedral.

“One of our major problems in pursuing the four Rs was the total absence of an ‘as-built’ plan of the cathedral. We could not find it in the archives of the church or of the City of Manila. Thus, we did not know exactly why the marble floors, columns, and walls shook even without an earthquake,” Panganiban revealed.

“We did not know how to begin the four Rs and how to raise the necessary funds. Nonetheless, without much ado, without any written plans, and sometimes without any written requests, our donors gladly took our verbal assurances and gave generously. They were led by five families and companies: Ramon Ang and his low-profile daughter Cecil, the late Dr. George S. K. Ty, the brothers Jaime Augusto and Fernando Zobel de Ayala, the spouses Alberto and Sylvia Lina, and a very generous donor who prefers to remain anonymous to this day.

“Our general contractor was DM Consunji Inc., led by the genteel Sid Consunji and his sisters, Mrs. Josefa C. Reyes, Mrs. Edwina C. Laperal, and Ms. Luz Consuelo Consunji, who gladly donated their markups and margins,” he added.

Panganiban said the bayanihan spirit among business leaders hastened the rebuilding of the icon of Filipino Catholicism.

Bull Run Hopes

Hope for a market surge in the final quarter is being rekindled by the reduction of the effective corporate income tax rate to 20 percent from 25 percent, which traders say could boost earnings per share (EPS) forecasts by around 3 percent, depending on the sector and individual shares.

The market is considering an index climb to 7,500 before the end of the year.

At a 20 percent corporate tax rate, the Philippines will now be below the 23 percent average across ASEAN, from being the highest previously. The reduction will be applied retroactively from July 2020.

The Corporate Recovery and Tax Incentives for Enterprises to Maximize Opportunities for Reinvigorating the Economy (CREATE MORE) Act is expected to create a more attractive investment environment, enticing foreign direct investment and fostering local industry growth.

The Senate passed the CREATE MORE bill, which aims to stimulate the economy by reducing corporate income tax (CIT) rates. The bill also seeks to eliminate the value-added tax (VAT) on essential services and allow large domestic enterprises to receive VAT zero-rating, exemption, and duty exemptions. Traders said the sooner the president signs the bill into law, the better the prospect of a bull run.

Under the bill, large registered business enterprises (RBEs) with a capital stock of over P20 billion will be granted VAT zero-rating on local purchases and VAT exemption on imports, as well as duty exemptions on capital equipment, raw materials, spare parts, and accessories.

Export-oriented RBEs are also entitled to VAT zero-rating on essential services such as janitorial, security, financial consultancy, marketing, and human resources, according to a copy of the bill.

AP Securities said CREATE MORE should boost corporate earnings, especially in the consumer and telecommunications sectors, which are still paying close to the statutory tax rate of 25 percent. Property developers could also benefit, as tax exemptions on imports of capital equipment and raw materials translate to lower costs and higher margins. The impact on the banking and power sectors will be more limited, given that these sectors already enjoy some preferential or lower tax rates.