Gatchalian wants to align PH capital markets with ASEAN neighbors; encourage more Filipinos to invest in capital market
November 10, 2024
Gatchalian wants to align PH capital markets with ASEAN neighbors; encourage more Filipinos to invest in capital market
Senator Win Gatchalian has filed a bill that seeks to align the Philippines' capital markets with its ASEAN neighbors in terms of attracting investors, enhancing market development, and fostering growth.
Gatchalian filed Senate Bill 2865 or Capital Markets Efficiency Promotion Act which, once enacted into law, would put the country's tax rates on income generated from capital investments more closely with other countries in ASEAN.
"Investing in the Philippines is more expensive vis-a-vis our neighboring countries. We hope that the enactment of this proposed measure would enable our country to catch up and encourage more Filipinos to invest in our capital markets," Gatchalian said.
"Malaki ang papel ng sektor ng pananalapi sa pangmatagalang paglago ng ekonomiya. Inaasahan natin na sa pagsasabatas ng panukalang ito ay magiging mas malakas ang sektor na ito at makakahikayat ng mas maraming Pilipino na mamuhunan," he added.
He cited the Asian Development Bank's Key Indicator Database in 2023, which showed that the value of the country's stock market relative to the size of the economy stood at 54.1%, significantly lower than the average 78.3% among other Southeast Asian economies.
This is caused in part by the country's imposition of a?stock transaction tax (STT) of 0.6% on the value of the transaction, currently the highest in the region, he said. Other Southeast Asian countries such as Malaysia, Singapore, Thailand, Myanmar, and Cambodia do not impose any STT while Indonesia and Vietnam only impose an STT of 0.1%, the senator noted.
He said the Philippine Stock Exchange made a forecast that the proposed reduction in STT to 0.1% would lead to an aggregate value of stocks traded to P4.9 trillion in fiscal year 2029, which will be 3.79 times greater than the value of stocks traded in fiscal year 2023.
Gatchalian said another contributing factor to the friction costs is the imposition of documentary stamp taxes (DST), which under the proposed measure would be reduced from 1% to 0.75% of the par value of the shares of stocks.
"These friction costs create a barrier for Filipinos to engage in our markets, as they make investing costly and far-reaching," he said.
Gatchalian: Ihanay ang capital market ng PH sa ibang bansa sa ASEAN; hikayatin ang mas maraming Pilipino na mamuhunan
Naghain si Senador Win Gatchalian ng panukalang batas na naglalayong ihanay ang capital market ng Pilipinas sa ibang bansa sa ASEAN sa mga pamamaraan nila ng pag-akit ng mga mamumuhunan at pagpapaunlad ng merkado at ekonomiya.
Inihain ni Gatchalian ang Senate Bill 2865 o Capital Markets Efficiency Promotion Act na, kapag naisabatas, ay maglalagay sa mga tax rates ng bansa sa kita mula sa capital investments nang mas malapit sa ibang mga bansa sa ASEAN.
"Mas mahal ang pamumuhunan sa Pilipinas kung ikukumpara sa ating mga kalapit na bansa. Umaasa kami na ang pagsasabatas ng panukalang ito ay magbibigay-daan sa ating bansa na makahabol at makahikayat ng mas maraming Pilipino na mamuhunan sa ating mga capital market," sabi ni Gatchalian.
Sinabi niya na ang Key Indicator Database ng Asian Development Bank noong 2023, na nagpapakita na ang halaga ng stock market ng bansa kung ikukumpara sa laki ng ekonomiya ay nasa 54.1%, malaking mas mababa kaysa sa average na 78.3% sa iba pang ekonomiya sa Southeast Asia.
Isa sa mga sanhi nito ay ang pagpapataw ng bansa ng stock transaction tax (STT) na 0.6% sa halaga ng transaksyon, na kasalukuyang pinakamataas sa rehiyon, aniya. Ang ibang bansa sa Southeast Asia tulad ng Malaysia, Singapore, Thailand, Myanmar, at Cambodia ay hindi nagpapataw ng anumang STT habang ang Indonesia at Vietnam ay nagpapataw lamang ng STT na 0.1%, sabi ng senador.
Sinabi rin niya na ang Philippine Stock Exchange ay nagsagawa ng pagtataya na ang iminungkahing pagbawas sa STT sa 0.1% ay hahantong sa isang 'aggregate value of stocks' na ikinalakal sa P4.9 trilyon noong 2029, na magiging 3.79 beses na mas malaki kaysa sa halaga ng mga stock na ikinalakal noong 2023.
Sinabi ni Gatchalian na isa pang kadahilanan sa friction cost ay ang pagpataw ng documentary stamp taxes (DST), na sa ilalim ng naturang panukala ay mababawasan mula 1% hanggang 0.75% ng par value ng shares of stocks.
"Ang mga gastos sa friction na ito ay nagiging hadlang sa mga Pilipino na makisali sa ating mga merkado, dahil sa mahal ang pamumuhunan," sabi niya.
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