Press Release
June 22, 2020

Incentives not taxes for online entrepreneurs - Gatchalian

Senator Win Gatchalian has prodded the government to extend fresh capital and other financial assistance to budding online entrepreneurs, instead of slapping them with untimely new taxes.

Gatchalian said online sellers should be covered by the microfinancing program of the Small Business Corporation (SB Corp.), a Government-Owned and Controlled Corporation (GOCC) attached to the Department of Trade and Industry (DTI), to assist them in growing their business to recover from the economic effects of the pandemic.

SB Corp., under the guidance of the DTI, has set up a P1 billion Enterprise Rehabilitation Financing facility under the Pondo sa Pagbabago at Pag-asenso (Covid19 P3-ERF) to support micro and small businesses affected by the economic impact of Covid-19 in the country. SB Corp.'s microfinancing program offers a minimal interest rate of not more than 2.5% per month with no collateral requirement. Micro enterprises with asset size of not more than PhP3 million may borrow PhP10,000 up to PhP200,000 while small enterprises with asset size of not more than PhP10 million may borrow a higher loan amount but will not exceed PhP500,000.

"Ang DTI ay dapat magbigay pa nga ng puhunan sa mga Pilipino na nawalan ng trabaho at gustong makaahon sa kahirapan sa pamamagitan ng pagnenegosyo sa online. Sa ganitong panahon ng pandemya, mas magandang nasa tahanan lang sila at nag-nenegosyo. Nabibigyan pa nila ng trabaho ang mga delivery service riders." Gatchalian said.

"Hindi lang basta ayuda ang hinihingi ng mga negosyanteng ito. Ang hinihingi nila ay malaya silang bigyan ng oportunidad na makapag-negosyo para may kita sila," he added.

The Vice Chairman of the Senate Committee on Economic Affairs has openly criticized the Bureau of Internal Revenue's pronouncement of taxing online sellers, emphasizing that such move is ill-timed and insensitive.

Gatchalian further added that registering businesses with the BIR is ineffective since its system requires an applicant's physical presence at this time when people are still being restricted to go out of their homes.

"Nakita ko na hindi rin handa ang ating pamahalaan na buwisan ang ating mga maliliit na negosyante dahil yung ultimong pagre-rehistro ay hindi pa sila handa kaya huwag na nating ipilit sa ganitong panahon ng pandemya, dahil hindi lang marami ang naghihirap kundi marami rin ang natatakot na lumabas ng kanilang bahay," he stressed.

Aside from providing capital, Gatchalian also urged the DTI to make use of the Philippine Innovation Law to enhance the competitiveness of these online sellers. The law, which Gatchalian championed during the 17th Congress, aims to harness innovation efforts to help the poor, the marginalized, and MSMEs to be a part of the domestic and global supply chain.

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