The Philippines will offer increased corporate income tax cuts to foreign investors in an attempt to open up its economy.

Philippine Trade Secretary Ramon Lopez said Wednesday the changes should provide overseas investors with more incentive to bring their businesses to the country and this will help the Philippines bounce back from the pandemic.

Lopez said a new bill should effectively cut corporate tax rates from 30% to 25%. Pending further studies and reviews, the country hopes to eventually cut corporate tax rates to as low as 20% in the coming months.

"Over the years, you've seen how the Philippines and especially economic policies have been insulated from changes in government and administrations. Essentially, it's one direction toward improving the business environment," Lopez said.

Lopez said that his office will be working toward creating changes that will further open up the country's economy regardless of who's in power.

The new bill, which is now pending in the Senate, aims to make the country's tax policies much more flexible to enable it to compete for high-value investments on the international stage. The proposal is seeking to change the current policies into a performance-based and time-bound system.

The Philippines has also launched a Board of Investments campaign to prioritize industries aimed at bolstering the economy. This includes priority sectors such as electronics, automotive, aerospace and information technologies. Lopez said that the campaign is one way to entice foreign corporations to look into the Philippines as a potential location for investment.

The economy went into a recession earlier in the year as the country became the second-hardest COVID hit nation in Southeast Asia. Economic activity fell to lows as consumer sentiment weakened after the government was forced to impose lockdowns. This, in turn, resulted in forced business closures, resulting in millions of jobs lost.

Lopez said that the economy had started to pick up with the Philippines reporting a quarter-on-quarter growth during the three-month period ended September.