Friday, July 21, 2017

Facts on the new tax system | The tax reform of the Duterte administration will only impair the poor

The Senate is expected to climb the first phase of the Comprehensive Tax Reform Program House Bill No. 5636 or Tax Reform for Acceleration and Inclusion (Train) after the deliberation of the Chamber.

Under the program are plans to remove VAT exemptions other than senior citizens and persons with disabilities. It also includes adding tax for petroleum products, sugar beverages and even the car industry.

The Department of Finance (DOF) program has led the support of the vast sector of "high income earners" to cause the proposal to pass 246 members of the Chamber.

But according to the Ibon Foundation, research institutes, there are five (5) features of the Train that the DOF proposes.








1. The poor will only make tax reform more difficult.

The DOF said the reform will reduce the tax burden of taxpayers' burdens. Conversely, tax reform will further aggravate the people's hardship. This will have an impact on 13.7 million families or more than 60 million poorest. If government gets more than P737 annually from each family earning P5,214 a month next year up to P2,088 from 2.3 million families with a monthly income of P19,269.

Instead of reducing the government's taxes, the price of basic commodities will increase.


2. Rich people will be rich in tax reform.

New taxation will include additional 9.1 million households with 40 million Filipinos including the richest families in the country.

The 2.3 million families with a monthly income of P24,355 will have an additional P4,187 annually. The next 2.3 million families with a monthly income of P32,295 will have an additional P8,012. There will be additional P16,954 in the 2.3 million families earning P47,131 a month. An additional P43,540 will be available for 2.3 million families with a monthly income of P111,380. They had net gains due to the increase in their take home pay from lower personal income taxes.

For corporate executives it would mean an additional P91,027 that earns P280,309 (or P3.4-M per year). For a chief executive of a company that earns P598,132 a month, additional P130,267 will be available.

The tax reform program of the Duterte administration will do nothing for the continued accumulation of wealth in the hands of a few. The more it affects the situation.
3. TRAIN tax is permanent but its social protection is temporary.

The only reason the DOF provides is that the poor on the Train will benefit from it because it has social protection. In earlier proposals, there is a cash transfer of P300 per month for the 50 percent poorest or 10 million Filipino families in the country to ease the rise in prices and Pantawid Pasada cash card for public transport to ease the impact of Increasing oil excise tax especially on diesel.

The Train Bill, which is passed by the House, is also very serious in the alleged social protection. On 59 pages, there is no one page mentioning "social benefits program" and "granting fuel vouchers to qualified transport franchise holders." Clearly provided, these will only last for three years. That is, they are short-lived.


4. The DOF seems to blackmail the poor because it fears taxing the rich.

There is a concrete record and a strong reason why the poor taxpayers should not apply to the poor. If tax increases the wealthy population of 1.5 percent of the population can reach P91-B to be generated. But the reform of the taxation of billionaires and millionaires remained unchanged. It is reported that there are approximately 690 Filipinos with a total value of P1.4-B. These include the richest oligarchs that have been spotted with P3.8-Trillion.

The DOF also has the right to have adverse effects on the lives of the poor as in the absence of classrooms, teachers, rural health units, barangay health stations, provincial hospitals, roads, bridges, and irrigation, but the poor should not be looked for Of them but of the rich.
5. Train destroys the tax system to make it even more anti-poor and favorable to the rich.

The Tax Reform for Acceleration and Inclusion is the system behind the mask. Reforms focused on a more profitable system are diverted. Those who are hard on the reforms are first lifted.

It only shows the sort of classification in Filipino society and the implementation of neoliberalism which benefits the few. However, the ruling classes must fear it. Because it will only revive the contradiction in society and bring more tension between the types in which real reform begins.

The proposal is scheduled to go up to the Senate and the target day it will be in July at the sessions of the high council session.

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