On 5 March 2024, the House of Representatives (“House“) approved House Bill No. 9277 (“HB No. 9277“), which proposes the enactment of Capital Markets Efficiency Promotion Act (“CMEPA“). In connection with this, HB No. 9277 also proposes amendments to the National Internal Revenue Code (“NIRC“), particularly the provisions under Sections 22, 24, 25, 121, 127, 184, 185, and 190. Upon its approval by the House, HB No. 9277 became Senate Bill No. 2865 and was filed by Senator Win Gatchalian.
One key proposed amendment of the CMEPA is the reduction of the tax rate on the sale, barter, exchange, or other dispositions of shares listed and traded through the local tax exchange (or through initial public offerings) from 0.6% to 0.1% of their gross selling price or gross value. The CMEPA seeks to encourage greater participation from both domestic and foreign investors in the Philippine capital markets through this proposed amendment to the NIRC which significantly lowers trading costs.
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