THE Sentrong Samahan ng mga Nagkakaisa at Progresibong Manggagawa (Sentro) said the proposed Tax Reform for Acceleration and Inclusion (Train) of the Duterte administration is leading towards a regressive tax system in the country.
Sentro Secretary-General Joshua Mata, who spoke at the dialogue between workers in Negros Occidental and the officials of the Department of Finance (DOF) at Bacolod Pavilion Hotel on Thursday, August 3, said it is high time to reform the tax structure, but it should be from a very regressive system to a progressive one.
He said the group believes that while tax reform provides lower personal income taxes, the government will recover these revenue losses through regressive tax measures like value added tax and excise tax.
“The direction being taken by the Train is somehow reverse. We feel that it is going towards a very regressive system,” Mata said, adding that “those capable to pay more should have higher taxes while the poor ones should have smaller, if not zero, taxes.”
Sentro, composed of about 100,000 workers from both private and public sectors, is currently stepping up its efforts on holding dialogues and fora all over the country to bring people, especially workers, directly to the government.
This is part of the group’s efforts to make sure that those affected by the policies and other reforms in the government are directly engaged.
Negros Occidental, being the major producer of sugar, will surely be affected by the tax reform proposal as it asks for P10 excise tax on sugar-sweetened products, the Sentro said.
Aside from the dialogue in Bacolod City attended by about 100 participants, mostly sugar and beverage workers in the province, the group is also holding similar activities in other provinces.
Mata said the government, particularly the DOF, failed to look at the whole chain.
“The proposed tax reform can be a subject of exploitation and will definitely be used by unscrupulous employers to justify their plans to kick out workers,” he added.
Mata said the discussion on the personal income tax should be separated from the excise tax, which has to be done comprehensively.
“It’s a shame that the House of Representatives passed such version of the tax reform without hearing and looking at all sides. We just hope that the Senate will live up to its promise to thoroughly review the Train,” he added.
Finance Assistant Secretary Ma. Teresa Habitan, who also spoke at the dialogue, reiterated that the proposed tax reform package is not an anti-poor measure, particularly the increase in excise for fuel products and automobile.
Habitan also reaffirmed that the new tax system, if approved, will bring in major infrastructure projects and would address the gaps in major government service areas like in education, health and social protection.
“If we are just to rely on personal income taxes, the government will incur revenue losses of about P140 billion thus, we need to have other sources like VAT expansion, automobile and petroleum excise, tax admin measure, and complementary measures, including tax on sugar-sweetened beverage,” she added.