07/25/2011
While the country gets
increasingly distracted by the “Hello Garci” and Lintang Bedol dramas,
the many Gloria Arroyo plunder cases that seem to have a number of legal
loopholes, as well as today’s worn-out “anti-corruption” State of the
Nation Address (Sona), the real game in the system — the financial
mafia’s blood-sucking of the people — continues to intensify.
The
Supreme Court (SC)’s approval over the weekend of the 12-percent Value
Added Tax (VAT) on toll fees by the Bureau of Internal Revenue (BIR),
affecting among others, the North and South expressways, is just the
latest in a string of backbreaking tax burdens and price hikes. What
this SC decision also makes clear is that nothing can stop the toll
operators from passing it on to commuters.
Perhaps to soften the
impact of its decision, the SC ponente resorted to some semantic play.
It claimed that while “the seller (of the toll service) remains directly
and legally liable for payment of the VAT... the buyer bears the burden
since the amount of VAT paid by the former is added to the selling
price,” arguing that “Once shifted, the VAT ceases to be a tax and
simply becomes part of the cost that the buyer must pay in order to
purchase the good, property, or service,” thereby declaring that the
“VAT on tollway operations cannot be a tax on tax even if toll is deemed
as a ‘user’s tax’… since VAT is assessed against the tollway operator’s
gross receipts and not necessarily on the toll fees.”
But is
there really a difference if VAT were to be based on the operator’s
receipts since all of it will be taken from commuters’ pockets anyway?
The
problem with this new, additional expanded VAT (eVAT) in the life of
Filipinos is the eVAT law itself — a law that has opened the floodgates
to endless regressive taxes. A little history of the tax system in RP
would thus be helpful.
Before Edsa I, the country had progressive
taxation based on income tax where those who can afford paid more while
those who earned less paid less. The VAT law that came with the Cory
Aquino regime changed all that. It introduced the VAT system, which is
based on taxing consumption, with the end-users shouldering much of the
burden. It is regressive since it taxes the poor more than the rich.
A
tax on toll fees, for example, would be the same for a brand new
Mercedes Benz and a 20-year-old dilapidated Toyota Corolla whenever such
vehicles pass through the toll booth.
Early on, when the VAT was
made part of the Comprehensive Tax Reform Program (CTRP), it was touted
as the last time any new tax would have to be raised. But, as we all
know, the VAT was immediately expanded under Fidel Ramos. Of course, it
was the IMF-WB that lobbied for all of it; but since it was our Congress
that capitulated (as usual), it only exemplified the idiocy of our
politicians for crafting such a law.
One such fellow, Nueva Ecija
Rep. Renato V. Diaz, is now ironically one of two petitioners at the SC,
challenging the Department of Finance (DoF) and the BIR’s imposition of
the toll eVAT (the other being former Trade Assistant Secretary Aurora
Timbol).
Since the high court in its decision was able to state,
“The VAT on franchise grantees has been in the statute books since 1994
when Republic Act 7716 or the Expanded Value Added Tax law was passed.
It is only now, however, that the executive has earnestly pursued the
VAT imposition against toll way operators,” clearly, Diaz has been
ignorant of the full meaning and impact of the law he co-authored all
along.
That said, the imposition of the tax is still a political
as well as an ideological issue. Even as Gloria Arroyo’s supporters say
that she stalled on the VAT on toll ways throughout her nine years in
office (as opposed to Aquino III, who only put the brakes because it was
challenged before the SC), the truth is, she only withheld its
implementation because of political expedience, whereas Aquino III,
without a similar sense of the limits of his “political capital,” merely
allowed his BIR appointee and Finance Secretary, both IMF assets, to
get the better of him.
The case brought before the SC actually
saved Aquino III for a while. Now that he has to face the music and
decide on whether to impose or not, his campaign promise of “no new
taxes” will surely be tested. Still, given his administration’s
financial and economic thrust, there isn’t any hope for an ideological
shift to progressive taxation, which is our only liberation from the
continued tax exploitation and extraction.
But as bad as this
recent development already is, the pressure to raise the eVAT from 12 to
15 percent is still on, as reflected in the official pronouncements of
the DoF, Neda (National Economic Development Authority), BSP (Bangko
Sentral ng Pilipinas), and the BIR.
Consumers and commuters
desiring to stop the VAT’s march to more perilous heights, though, do
not have the law on their side. As in the VAT on toll ways, they are
only limited to making appeals for the Chief Executive’s better sense
(if that’s even possible at all).
However, since Malacañang is
still in the mode of fending off pressure to hike the eVAT to 15
percent, it is more than likely to give in to the temptation of the
green-lighted VAT on toll ways.
As such, Filipino consumers and
commuters will never have a permanent respite from increasing regressive
taxes unless the country returns to progressive taxation — which will
only happen after a genuine popular revolution.
(Tune in to Radyo
OpinYon, Monday to Friday, 5 to 6 p.m., and Sulo ng Pilipino, Monday,
Wednesday, and Friday, 6 to 7 p.m. on 1098AM; Talk News TV with HTL,
Tuesday, 8 to 9 p.m., with replay at 11 p.m., on GNN, Destiny Cable
Channel 8, on “DoST Expo 2011: IGNITE THE FILIPINO MIND”; visit
http://newkatipunero.blogspot.com and
http://hermantiulaurel.blogspot.com for our articles plus TV and radio
archives)
(Reprinted with permission from Mr. Herman Tiu-Laurel).
Source: The Daily Tribune
URL:
http://www.tribuneonline.org/commentary/20110725com5.html
