in

Duterte tax reform ‘very anti-middle class,’ ‘harmful’ to the poor – lawmaker

No matter how President Rodrigo Duterte wants to unburden the masses of heavy taxes, everything will fail as long as new and expanded taxes offset all such efforts. This was how Marikina Representative Miro Quimbo, an opposition lawmaker, saw the present tax situation in the country.

“The arrangement is those who are easy to capture, let’s squeeze the blood out of these people, while those that are difficult (to tax), let’s leave them (alone),” Quimbo told Nancy Irlanda in an interview on Dateline Philippines Weekend.

Moreover, he described how the proposal will be “very anti-middle class” and raising VAT will actually be “harmful” to the poor.

President Duterte had asked Congress to lower taxes for the middle class from 32 percent to 25 percent. On the other hand, taxes for the so-called “ultra-rich” would be raised to 35 percent. In addition, Duterte also asked the lifting of some VAT exemptions and place tax on fuel and impose a sugar tax.

[ads1]

But in the end, the tax measures will just redound to burdening ordinary people more than giving them ease. Accordingly, real tax payers mostly comprise of ordinary employees and workers who are taxed regularly and have no means of evading or cheating taxes, unlike some rich people.

“It’s as if the BIR (Bureau of Internal Revenue) and DOF (Department of Finance) are saying, there’s nothing that we can do about tax compliance so let’s just find a way for ‘yung konting nagbabayad hanapan natin ng paraan para mas magbayad pa (let’s find ways on how to tax further the few people who are actually paying tax). In my mind it’s very short-sided,” Quimbo said.

So, what does the lawmaker propose?

Quimbo emphasized on tax collection efficiency. Instead of creating new measures and new levies, simply improve on tax collection, particularly aiming to lift it to the level of Southeast Asian standards. Anyway, the Philippines is said to have the highest income tax rate in this region.

Quimbo explained how only 15 percent of wage earners—ordinary employees—in the country actually pay taxes. Add to that, not all of them pay the same amount of taxes even if they get the same monthly salary. That’s a very narrow tax base to derive national revenues from. The logical solution then is to broaden the tax base.

“The challenge is we need to expand the tax base. Otherwise, ordinary teachers, ordinary soldiers, [and] ordinary government employees will continue to shoulder the tax burden,” he explained.

Quimbo is also militating for an income tax exemption for people making P300,000 annually, while increasing the rate for people making P10 million or more.

source: (news.abs-cbn.com)

[ads3]

Leave a Reply

Your email address will not be published. Required fields are marked *

Cop Assaulted by Protesters

Busted: FB pages posted photo of cop assaulted by protesters, but it was taken in 2013!

String Attached to US Aid

‘String attached’ to US Aid? It’s training, know-how, not economic, military interests, says top US envoy