Give us some credit: MBEs

By Rebelander S. Basilan

Saturday, September 24, 2011

MICRO-ENTREPRENEURS in Cebu called for better access to credit and exemptions from local taxes during yesterday’s public hearing on the proposed amendments of the Barangay Micro- Business Enterprise (BMBE) Act.

The House committee on small business and entrepreneurship development presented the proposed amendments at the hearing, attended by micro-entrepreneurs, representatives from government agencies and local government units (LGUs), and some of Cebu’s congressmen.

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Among the proposed amendments is the exemption from local taxes of businesses with a capital of P200,000 and below.

Bayan Muna Rep. Teddy Casiño, head of the committee, said this proposed amendment is a “sticky issue” because local government units are concerned about their tax collection.

One LGU representative pointed out that most LGUs may not agree with the proposal because it will significantly reduce their tax collections.

But Rep. Pablo John Garcia (Cebu Province, third district) said the problem confronting micro-business enterprises (MBEs) is not so much about the taxes. The lack of access to credit, he said, is the biggest problem MBEs face.

Amending the BMBE law should address the poor access to credit by MBEs, which were the first to suffer from the present global credit crunch, he said.

Rep. Benhur Salimbangon (Cebu Province, fourth district) lamented that banks impose too many requirements before MBEs can get a loan.

“Credit should be made available to MBEs with fewer requirements,” he said.

Deputy Speaker Pablo Garcia (Cebu Province, second district) shared the same sentiment. “We are awash in cash but we are strangled by regulation,” he said.

He pointed out that MBEs are forced to borrow from loan sharks because they could not borrow from banks.

At the hearing, some micro-entrepreneurs pointed out that banks have stereotyped MBEs as delinquent creditors.

Department of Trade and Industry (DTI) 7 Director Nelia Navarro expressed approval of the proposed amendments of the BMBE law, which was passed last 2002.

“For MBEs, how to get the money is a major concern,” she said. But Navarro also pointed out the need to put in place a stronger monitoring mechanism for MBEs.

The proposed amendments include lowering the registration fee BMEs pay to LGUs from P1,000 to P500.

Another is the tapping of local business chambers or recognized business associations in the identification, evaluation and monitoring of MBEs.

The proposed amendments are important to uplift the country’s MBEs, which create majority of the jobs for Filipinos, Casiño said.

He said the committee, which will also conduct a hearing in Mindanao, hopes to have the amendatory bill passed in Congress within the year.

Published in the Sun.Star Cebu newspaper on September 25, 2011