There is much excitement and anticipation over the Philippines’ economic growth in the coming years. According to the World Bank, the Philippine economy remains strong and is projected to grow 5.8% in 2019, before recovering to 6.1% and 6.2% in 2020 and 2021, respectively.
This is a clear indication of improvement in the Filipinos’ financial literacy, aspirations, and participation, an area Under the PIFITA, it is proposed that dividends received by individuals on domestic shares shall be taxed at the final withholding income tax rate of 15%, up from the current 10%. This move to increase the tax on dividend earnings makes it more costly for the common Filipino to participate in the domestic economic growth in several ways., it is cheaper for corporations to invest in shares than individual Filipinos.
It is no secret that despite its age, our stock market remains to be one of the smallest in the region.To say the least, the proposal will be counter-productive to what the government and the private sector have been doing.