BMBE Law suffers from flaws

Sunday, February 12, 2012

THE House committee on small business and entrepreneurship development is bent on amending the Barangay Micro Business Enterprises (BMBE) Law, which Bayan Muna Representative Teddy Casino described as a failure.

"It's a combination of failure to implement and the weakness of the law," said Casiño, chair of the committee. "It failed to live up to its mandate."

Have something to report? Tell us in text, photos or videos.

Casino said the BMBE Law of 2002 was enacted supposedly to promote the growth of the micro businesses, yet it generated little registrants.

During the public hearing on the proposed amendments to the BMBE Law last Friday at the Grand Men Seng Hotel, Casiño discovered that only 44 out of the thousands of micro business in Davao City have been registered as micro businesses.

Of the 44, only seven were recognized by the Bureau of Internal Revenue (BIR) to be exempted from paying local and national taxes.

Also, owners of micro business who want to register their enterprises will also have to pay P1,000 for them to be issued a barangay micro business certificate.

"Ang nag-aaprove pa pala ng registration ng mga small businesses ay ang national office ng BIR (The one who approves the registration of the small businesses is the national office of BIR)," Casiño said.

Owners who have a capital income of not more than P200,000 will be recognized as small and medium enterprises and will be exempted from paying the national and local taxes for two to six years.

After these small entrepreneurs attain stability in their businesses, that's when they will have to pay for the regular taxes.

Still covered by the provisions of the law are those sidewalk vendors. The BMBE is also aimed at bringing the informal vendors to the national system.

"We wanted to bring them to the national system so that they will be included in the plans and programs of the government," Casiño said.

He also pointed out that registering informal vendors as small businesses will not affect the revenue of the local government.

"In fact, it will not reduce or add anything to the local government," Casiño said, adding informal vendors don't pay local taxes and that once their businesses grow, it will generate jobs, which is good for the economy of the local government.

"They are not milking cow or sources of income," he said while suggesting that local government units should assist them.

He said the BMBE Law must be amended to become responsive to the small businesses.

"We want business to be more fun in the Philippines," Casiño said.