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Saturday, January 29, 2005
Local governments asked to air views on VAT hike
CEBU CITY -- Militant groups marched Friday to oppose the two percent increase in the value-added tax (VAT) and to condemn at least five Cebuano lawmakers who voted for the measure.
Three members of the Cebu Provincial Board (PB) deplored the support Cebuano congressmen gave to the increase and joined those who hope the Senate will junk the VAT Restructuring Bill.
"This is both not popular and not right. I think most of the congressmen did not read the writing on the wall, or did not feel the pulse of their people," said PB Member Victor Maambong. Maambong and colleagues Antonio Almirante Jr. and Joven Mondigo oppose the increase.
Five Cebuano members of the House of Representatives were among the 126 who, early Thursday morning, approved the bill to increase the VAT rate from 10 to 12 percent. They are Deputy House Speaker Raul del Mar and Representatives Eduardo Gullas, Antonio Yapha, Simeon Kintanar and Nerissa Soon-Ruiz.
Cebu City Representative Antonio Cuenco was absent, while the House Journal Service had no record of how Representative Clavel Asas-Martinez voted.
Maambong, who is from the sixth district, called on all local government units in Cebu to express the sentiments of their people, especially since "basic commodities are not exempted."
VAT is charged on a wide range of transactions, including hotels, restaurants, securities dealers, cab or car rental companies, telecommunications franchises, books, ads, meat importations, real properties and processed gas, among others.
'Bitter pill'
But Cebu City Mayor Tomas Osmeña agrees with the 12 percent VAT rate, as long as it will not be passed on only to poor consumers.
"Generally, it's acceptable to me. Heaven knows, to tell you frankly, I don't like paying taxes but if we have a breakdown because of uncontrollable deficit spending, we have to tax something," he told reporters.
Osmeña said, though, that more taxes should be imposed on the rich through income taxes, so the poor will have more money to spend.
"The problem with income tax is, the rich don't pay anything. I pay maybe 80 percent more than the Chinese Chamber of Commerce members and 95 percent of them are richer than me. It's very defective. It's meant to tax the rich, but it taxes mostly those with fixed salaries," he added.
But former Cebu governor and now Capitol consultant Pablo Garcia called on everyone to cooperate with President Arroyo for the nation's survival.
This may be difficult but people have to make sacrifices, even "swallow the bitter pill if need be," for the country's economic health, he added.
The VAT is "equitably distributed" in the sense that "if you do not consume, you do not pay tax," said Garcia.
Street protests
Contrary to the claim of proponents that the increase will have a minimal effect on the poor, Almirante warned that even electric bills will increase because of this.
"I would not be surprised if streets will be filled with protests," he said. "Tax reforms should begin with making collection agencies perform well, such as the Bureau of Customs, Bureau of Internal Revenue and the Land Transportation Office."
Mondigo said he "will oppose this measure through and through." He hails from the fourth district. Their representative, Martinez, still could not be contacted Friday.
"The truth of the matter is, they are approving that because that is easy to collect. There are many other ways to help improve the country's economy, like curbing smuggling and minimizing corruption," said Mondigo.
Jaime Paglinawan, Bayan Central Visayas-Chairman, said the government should instead go after tax evaders.
He lamented the absence of public consultation and said VAT increase will worsen the difficulties of ordinary Filipinos, who can hardly afford to buy basic commodities like milk, canned goods or clothing and pay for services like health care, rent and water.
Prices rising
According to the Department of Trade and Industry's price monitoring report on basic and prime commodities sold in Cebu City, there were already increases of three to seven percent in some brands of milk, coffee, laundry soap, detergent bars and flour from last month.
As of Monday, the average price of a can of sardines stood at P9.60. With the additional two percent VAT, it could go up to P9.79 if the law gets the Senate's approval.
As of 2000, census data showed that the average daily expenditure of a family in Cebu Province was P7,829 monthly, or P261 daily.
For a family in Cebu City, monthly expenditures amount to P10,775 or about P359 a day. The daily minimum wage currently stands at P208.
Nick Abasolo of Kilusang Magbubukid sa Pilipinas (KMP)-Cebu said Cebuano lawmakers who supported the increase should have considered the plight of farmers, who make do with sardines and noodles during difficult times.
"Apilon nato sila pag-kondena kang Arroyo kay sila ang gitahasan sa pagpanday ug balaud para sa kaayuhan sa katawhan (Let us condemn them, along with Arroyo, because they have failed to do their duty of coming up with laws that benefit all Filipinos)," Abasolo said of Cebuano lawmakers who voted for the VAT increase. (CYR/JPM/LCR)
(January 29, 2005 issue)
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