APRIL 23, 2014

NR # 3445

Solon seeks to maximize untapped potential of MSMEs

Recognizing that micro, small and medium enterprises (MSMEs) have the potential for more employment generation and economic growth that can help provide a self-sufficient industrial foundation for the country, a lawmaker today urged ongress to fast track the approval of a measure enhancing government support for the sector! Rep! "eodorico #aresco, $r! (%one &istrict, 'klan) filed #ouse (ill )**+ saying government should ma,imize the untapped potential of the MSME sector -y giving it incentives and -enefits and -y strengthening participation of the private sector! ."hough it is recognized that MSMEs have the potential for more employment generation and economic growth, its full potential is yet to -e realized -ecause of stiff competition capital with the large scale enterprises,/ #aresco said! #aresco said MSMEs compose 00!*1 of the -usiness enterprises operating in the country! 2f the total num-er of MSMEs, a-out 031 are micro enterprises! 'ccording to the lawmaker, MSMEs also accounted for )4!*1 of 5ross 6alue-'dded (56') to the economy! .7t is the accepted view that MSME8s still have immense potential or 56' growth such as -eing e,hi-ited -y their counterparts in 7ndonesia (4)!391), 6ietnam ()01) and "hailand ()*!91),/ #aresco stressed! :nder the measure to -e known as the .MSME Empowerment 'ct of 3;<=,/ micro enterprises shall -e e,empt from the payment of income ta, with respect to income received from the operations of the enterprise! 7t shall also -e e,empt from the coverage of the minimum wage law! 2n the other hand, registered small and medium enterprises which shall hire additional employees, shall -e allowed a deduction from its gross income in the amount of >=;,;;; for each new employee hired and that the ma,imum allowa-le deduction from gross income shall not e,ceed ><3;,;;;! Moreover, micro, small and medium enterprises shall -e e,empt from 6alue-'dded "a, (6'") registration and percentage ta, under the ?ational 7nternal Revenue ode, as amended! "he -ill also provides that local government units (%5:s) shall not charge micro enterprises any local ta, and are encouraged to reduce the amount of applica-le fees and charges! %5:s are likewise encouraged either to reduce the amount of applica-le local ta,es, fees and charges imposed or to e,empt the small and medium enterprises from the payment of local ta,es, fees and charges! "he measure mandates the >hilippine 7nformation 'gency (>7'), in coordination with the &epartment of "rade and 7ndustry (&"7), (angko Sentral ng >ilipinas ((S>), &epartment of %a-or and Employment (&2%E) and the &epartment of 7nterior and %ocal 5overnment (&7%5) to ensure the proper and ade@uate information dissemination of the contents and -enefits of this 'ct to the general pu-lic! ();) lvc