THERE’S no reason to doubt the government’s claim that by their arithmetic the now tax-exempt or reduced-tax wage/salary earner is still ahead in the face of rising prices consequent to the the revised tax code. But even without doing the arithmetic, the new tax code provides the low salaried worker with something more dignifying than just added income.
What critics fail to appreciate is the empowerment the revised tax code brings to low income earners in the form of the control they now have over the additional income equivalent to their tax exemption or reduction. Before the revision, their income tax was withheld and paid directly to the government leaving them with absolute zero control over that part of their income. They then had to face ever rising prices of basic commodities with their rarely augmented net (of tax) income. Forget about luxuries.
With the revised tax code, what used to be withheld they now receive and is cash on hand they can decide how to spend. They now have more cash at their disposal and not the government’s as their withheld tax was. It is cash that is within their power to use to fully satisfy basic needs or splurge on luxuries. The important thing is that there is added empowerment.
To use half of the allegory, the additional income from tax exemption and/or tax reduction is “one bird in the hand” whose fate (keep for basics or let go on luxuries) they can decide on. It is definitely better than the bird that got away in the form of withheld income tax of previous years.
Besides, 15 percent of the additional revenue will be spent on the president’s massive infrastructure program that will create jobs for thousands of workers not only in construction but also in the manufacture and distribution of materials and supplies. Moreover, a portion of the additional revenue will be used to substantially augment the health, education, and pangtawid cash budgets that mostly benefit the poor.
My fervent New Year’s wish is prosperity for the not-yet-prosperous of our countrymen/women. That would seem to be already beginning to be fulfilled with the revised tax code for workers. But hopefully the benefits will also trickle down to small farmer families from which the additional labour needed in the infrastructure program can come.
If poverty were a personal decision, you can be sure very few will opt for it. (How many Mother Teresa’s are there?) We have masses of poor people because poverty is imposed on them by the system. The revised tax code helps because it tweaks the system and empowers people to decide what to do with some additional income.
For all others I wish the peace that comes when prosperity is no longer exclusive but enjoyed by all. Happy New Year.