The Foundation for Economic Freedom (FEF) has lauded the tax reform program submitted by the Department of Finance (DOF) to the Congress, describing it as the groundwork for achieving the Duterte administration’s vision of inclusive growth, better public services and improved purchasing power for Filipino consumers.

According to FEF, which includes as its members former Cabinet secretaries and leading figures in the academic community, the DOF-proposed tax reform plan is “also aligned with the 10-point socioeconomic program” that President Duterte had put in place at the start of his administration.

“We, the Foundation for Economic Freedom (FEF), an advocacy group for good economic governance and market-friendly reforms, strongly commend the Department of Finance for crafting a forward-looking fiscal program for legislation,” the FEF said in a statement.

“We believe that this program will translate to a more comfortable life for all Filipinos along with safe, healthy, and peaceful communities all over the country,” it added.

The FEF has for its Board of Advisers, former Prime Minister Cesar Virata and former Socio-economic Planning Secretary Dr. Gerardo Sicat.

Its Board of Trustees is chaired by former Finance Secretary Roberto de Ocampo, and includes former Finance Undersecretary Romeo Bernardo as vice-chairman, political economist and entrepreneur Calixto Chikiamco as president, former Finance Secretary Ernest Leung as treasurer and Ricardo Balatbat as executive director and corporate secretary.

The DOF-proposed tax reform plan, according to FEF, will help the government raise the additional P1 trillion that it needs to accelerate spending on infrastructure, human capital and social protection.

“Moreover, its design and various components address identified problems in the current tax system namely: 1) too narrow tax base; 2) too complex collection policies with too many leakages; 3) exemptions with debatable benefits that are too cumbersome and costly to comply with; 4) inequitable taxation of salaried workers; 5) uncompetitive rates vis-a-vis our country’s peers; and 6) tax policies that are too prone to gaming, evasion, and corruption,” the FEF said.

Package One of the DOF tax reform proposal was submitted to the Congress last month. It includes proposals to reduce the personal income tax (PIT) rate, and offsetting measures such as adjustments in the fuel excise tax and the expansion of the value-added tax (VAT) base.

The FEF, in particular, is backing the DOF plan to reduce personal and corporate income tax rates.

“We particularly support the downward adjustments in the personal income tax on the grounds of fairness. We also strongly back the reduction in the corporate income taxes, which will promote and attract more investments and facilitate job creation,” the FEF said.

It also commended the DOF for crafting revenue-enhancing measures that would make these reductions in personal and income taxes possible, particularly the proposed adjustments in the fuel excise tax, the review of fiscal incentives, the relaxation of bank secrecy laws in fraud cases, and the expansion of the VAT base by limiting exemptions to raw food, education and healthcare.

“These policies will facilitate an equitable opportunity for every Filipino to contribute to the sustainable economic growth of the country that will truly be felt by every sector,” the FEF said.

The FEF’s other prominent members include Monetary Board member Dr. Felipe Medalla; former Presidential Adviser for Strategic Projects Gloria Tan Climaco; investment bankers Simon Paterno, Eddie Gana, and Vaughn Montes; international trade law adviser Anthony Abad; corporate lawyer Perry Pe; and urban land planning expert Dr. Art Corpuz.

In its statement, the FEF also said that “with the right set of public policies and investment programs that create an enabling environment for private sector investments, the Duterte Administration can attain the growth target of at least 7 percent annually, reduction of poverty from 26 percent to 17 percent, and a sharp reduction in the 25 percent unemployment rate over the next six years.”

“Fiscal stability, mobilization of resources to fund government programs, and investment-friendly tax policies will serve as a strong foundation to make these growth targets a reality,” it added.

Earlier, other prominent business and tax advocacy groups also expressed their support for the DOF-proposed tax reform program

These groups include the Federation of Filipino-Chinese Chambers of Commerce and Industry Inc. (FFCCCII), the Tax Management Association of the Philippines (TMAP), the Association of the Filipino Franchisers Inc. (AFFI), and the Philippine Institute of Certified Public Accountants (PICPA).

Civil society groups have also thrown their support behind the DOF tax reform plan. In a recent forum in Makati City, the head of one of these progressive advocacy organizations—Renato Redento Constantino of the Institute for Climate and Sustainable Cities—assured Finance Secretary Carlos Dominguez III that his group would exert “humongous effort” to get other sectors to support the DOF-proposed tax reform program.

A senior economist of the advocacy group Action for Economic Reforms (AER), Jo-Ann Latuja Diosana, earlier said she believes the DOF tax reform plan could be a “game changer” that intends not just to generate revenues but to raise enough funds to let the government address the backlog in physical and human capital investments.