DAVAO CITY, Philippines—Gabriela Women’s Partylist Representative Arlene Brosas branded the government’s tax reform package contained in House Bill 4774 as “deceptive,” saying it is anti-poor and unlikely to uplift people from poverty.
Brosas said that the savings from the lowering of income tax under the House Bill 4774 “will just be gobbled up by hikes in the prices of oil and other commodities due to higher excise tax and the expanded coverage of Value Added Tax (VAT).”
“The lowering of income tax serves as the icing on top of a very bad, stale cake. Underneath, we see an avalanche of price hikes arising from higher excise tax on oil and the expansion of VAT coverage that will surely hit both the poor and the middle class,” she said.
“Rents, gas prices, jeepney and bus fares, money remittance fees, airfare, electricity bills, among others will increase under the proposed tax reform. In particular, poor women will bear the brunt of increased budget pressures due to costlier utilities and consumer goods,” she added.
The House committee on ways and means has approved on Wednesday the proposed measure that imposes tax on diesel and other oil products. If enacted by Congress, the imposition of higher taxes will take effect in 2018. Under the proposed measure, an initial tax of P3 per liter will be imposed on diesel, an increase of P5 will be imposed on Jan. 1, 2019 and on Jan. 1, 2020, increasing it to P6.00.
Apart from the imposition of excise tax on diesel, HB 4774 also imposes a P6.00 tax for kerosene, liquefied petroleum gas, bunker oil on staggered basis over a period of three years. This means that the bill also increases existing taxes on other petroleum products to P8 per liter in 2018, P9 in 2019 and P10 in 2020.
But Brosas pointed out that said the supposed savings of the middle class from lower income taxes will be offset by higher excise taxes on oil and automobiles, not to mention the longer list of VAT-able goods and services.
“Income tax reduction and restructuring should be pursued independently rather than lumped with the baggage of new and higher taxes, as expressed in the deceptive packaging of HB 4774,” Brosas said.
The women’s party-list said the current form of the tax measure is very much attuned to the policy recommendation of the International Monetary Fund (IMF) regarding a “broad-based, comprehensive tax reform.”
“IMF is goading the national government to hike tax revenues through a broadened tax base so that the government can bankroll more private enterprises and finance new loans amid the lingering crisis of the global capitalist system,” Brosas said. (davaotoday.com)
