MANILA — Senator Paolo Benigno Aquino IV has filed a sensible bill granting tax exemption for start-up enterprises for the first two years of their business operations.
Under Senate Bill 2217 or known as the Start-Up Business Bill, the start-up enterprises would be given the proper time to stand on their own as they try to create a niche in the market.
“The intervention provides the opportunity for these start-ups to get organized, establish their business operations and market base,” Aquino, chairman of the Committee on trade, commerce and entrepreneurship, said.
The bill proposes a tax exemption for the first two years of operation will be provided only to the duly registered businesses that are not affiliated with any existing companies and have not previous or existing registered businesses.
“They should have at least five percent share with no nominal stockholders and in case of a corporation, a venture capitalist should only have up to fifteen percent of total outstanding shares,” Aquino said.
Aquino believes the passage of the bill will legitimize the start-ups’ role in the economy and the acknowledgement of the government’s commitment to innovation.
“Start-ups have the potential to spur and spread such innovation. As these enterprises have likewise the appetite to take on more risks, they would fuel creativity and challenge existing ways of doing business,” he said.
Aquino said the growth of start-ups would be beneficial for more Filipinos who have the innate talent of working with limited resources but able to fashion out contemporary ideas.
“Let them grow, and by the end of two years, they will be able to pay the right taxes and join the formal economy,” the lawmaker stressed.
“The idea is not to exempt businesses, but to give them space to grow,” he said.