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  • Writer's pictureBy The Financial District

House Bill Reducing Stock Transactions Tax Approved

The House Committee on Ways and Means approved a bill on Tuesday that seeks to reduce the stock transaction tax to 0.1% from the current 0.6%.


Committee chair, Albay Rep. Jose Ma. Clemente S. Salceda said the proposed Capital Markets Efficiency Promotion Act is "part of a broader effort to make the country’s capital markets deeper, more liquid, and more competitive." I Photo: Joey Sarte Salceda Facebook



Committee chair, Albay Rep. Jose Ma. Clemente S. Salceda said the proposed Capital Markets Efficiency Promotion Act is "part of a broader effort to make the country’s capital markets deeper, more liquid, and more competitive."


He noted that the Philippines’ current 0.6% stock transaction tax is the highest among Association of Southeast Asian Nations (ASEAN) members.



"Vietnam and Indonesia only impose 0.1%, while other neighboring countries exempt the sale of shares of stock. This keeps the Philippine bond and equity markets small relative to our regional peers," he said.


The Philippine Stock Exchange (PSE) has only 283 listed companies, while other stock exchanges in the region have between 425 and 963 listed companies. Salceda said, "An outright reduction from 0.6% to 0.1% may foster a conducive environment for investments and help domestic corporations raise capital.


All the news: Business man in suit and tie smiling and reading a newspaper near the financial district.

This will simplify the tax system as the distinction on the tax on trading of domestic shares whether in the local or foreign stock exchange will be removed."


PSE President and Chief Executive Officer Ramon S. Monzon commented that the trading volume would have to increase over three times to compensate for the loss in revenues from the reduction in the stock transaction tax.




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