Contemporary Economic Issues Facing the Filipino Entrepreneur

Learning Competencies

  • Analyze the effects of contemporary economic issues on Filipino entrepreneurs.

Entrepreneurship Topics

1. Filipino Entrepreneurship

  • Focus on innovation strategies and business structures.

2. Innovation Strategies of Entrepreneurs

  • Business-to-Consumer (B2C): Direct sales from businesses to consumers, eliminating middlemen.
  • Disruptive Innovation: Alters existing market structures and creates new industries (e.g. Facebook, FedEx, Tesla).

3. Business Structures

  • Types:
    • Sole Proprietorship
    • Partnership
    • Corporation

4. New Business Registration Steps

  1. Register business name with DTI.
  2. Secure barangay clearance.
  3. Obtain a business permit from the municipality.
  4. Apply for a Tax Identification Number (TIN) with BIR; secure authority to print receipts, have ledgers stamped.
  5. Register as a self-employed owner with SSS.

Issues and Challenges for Filipino Entrepreneurs

  • Investment Risks: Business is akin to gambling; investments have no guaranteed returns.
  • Interest Rate Effects: Low interest rates encourage investment; high rates deter entrepreneurship.
  • Rental Costs: More expensive in urban areas; higher rental fees impact overall expenses.
  • Minimum Wage: Encourages competitiveness but impacts labor costs; performance-based pay can augment wages.
  • Tax Implications: High taxes reduce investment attractiveness; conversely, low taxes may mean fewer governmental services.
    • Tax Rates:
    • Percentage Tax: 3%-15%
    • Value Added Tax (VAT): 12%
    • Capital Gains Tax: 5%-10%
    • Income Tax: 15%
    • Tax Reform for Acceleration and Inclusion (TRAIN)