After passing the bill reimposing the death penalty, the House of Representatives is now bent on imposing new taxes, a partylist lawmaker said.
“After death penalty, Congress is now bent on imposing new taxes,” ACT Teachers partylist Representative Antonio Tinio said.
“Death and taxes seem to be the priorities of this administration,” he added.
The Comprehensive Tax Reform Program (CTRP) bill recently approved by the ways and means committee of the House of Representatives gives income earners a lower income tax on the one hand, but on the other hand, consumers will shoulder higher cost of goods and services from the new and additional taxes to be imposed under the measure.
According to Tinio, there would be P140 billion in foregone revenues from the implementation of lower income tax – which will reduce the current 32 percent to 25 percent personal income tax.
However, the new and additional taxes to be imposed by the measure will generate around P250 billion in revenues for the government: excise tax on oil (around P120 billion); expanded Value Added Tax coverage (P90 billion); and, tax on purchase of new vehicles (around P40 billion).
“This is not just about recouping the revenue loss (from lower income tax), the objective is to generate more money to fund the government infrastructure projects,” he said.
He said the proposed measure was “anti-poor,” since many of them would not benefit from the lower income tax, as they are already tax-exempt if they are minimum wage earners.
But, they would be hit hard by the imposition of new taxes which would result in higher prices of goods and services, such as diesel and cooking gas.
Anakpawis partylist Rep. Ariel Casilao said the part of the expected revenue would be generated from the lifting of VAT exemptions on 79 goods and services, currently enjoying zero VAT.
Casilao said the ways and means committee has been silent in giving details on how much revenue could be generated from the l, ifting of the VAT exemption from the each sector, goods or services.
“They are not giving details on this because it would create a domino effect, a reaction from the sectors affected and covered by the 79 exemptions,” he said.
One sector that has a raised a howl was the cooperative sector, whose 14 million members all over the country will suffer if their savings and loans would now be taxed.
During the deliberation of the committee, Tinio said they learned that taxing the cooperative sector would rake in only around P3 billion to P4 billion, but which would be at the expense of millions of members.
The bill was approved at the committee level on Wednesday (May 3). It will go to the appropriations committee for review and will be returned to the mother committee before being referred to the plenary for deliberation.
Tinio said Congress targets to pass the tax package bill into law within the year, for implementation in January 2018.
In a statement, Department of Finance (DOF) undersecretary Karl Kendrick Chua lauded the “substantial progress” achieved by Congress in tackling the bill.
“We remain hopeful that with this committee vote for the substitute bill, the tax reform measure can still be approved at least by the House of Representatives before the Congress ends its first regular session this June. We will also convince the plenary to include some original provisions that were removed,” Chua said.
The CTRP aims to overhaul the country’s tax code by making the system simpler, more efficient and fairer especially for the poor and low-income Filipinos, the DOF said.
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