The Securities and Exchange Commission (SEC) is backing proposals to lower the taxes on stock transactions.

Specifically, the SEC supports the bill filed by Albay 2nd District Rep. Joey Salceda, which seeks to lower taxes on stock transactions to attract more investors into the market.

Salceda filed House Bill No. 8958, or the proposed Capital Markets Efficiency Promotion Act last month.

The proposal aims to bring the stock transaction tax (STT) down to 0.1 percent of the stock value from the current rate of 0.6 percent.

Similarly, the tax on dividends of foreign non-residents will be reduced to 10 percent from 25 percent.

Salceda, who heads the House ways and means committee, hopes that the lower taxes will encourage more local and foreign investors to participate in the Philippine stock market.

The bill has undergone deliberations at the committee level and has been substituted by House Bill No. 9277, filed on Sept. 21.

The SEC said lower taxes on stocks would help boost and improve the competitiveness of the Philippine capital markets.

SEC chairperson Emilio Aquino said the SEC welcomes the efforts of legislators to boost the capital market, as it recognizes the contribution and potential of the financial sector to help in the development of the Philippine economy.

'We will work closely with our lawmakers to ensure that new laws and policies will be reflective of the needs and demands of the market and investors, while still balancing the commission's role as regulator,' Aquino said.

The SEC has been stepping up efforts to encourage more investors into the capital market.

One measure is the SEC's move to shorten the trade settlement cycle to two days from three days after the trade date by amending the 2015 Implementing Rules and Regulations of Republic Act No. 8799, or the Securities Regulation Code.

The SEC also empowered funding portals to act as registrars of qualified institutional and individual buyers.

This eliminates the need for these portals to use third party institutions to assist potential investors with their applications as qualified buyers.

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