Bayan Muna Party list debunks claims by advocates of the government’s tax reform program that the bill will not lead huge jumps in the prices of prime commodities.
in a statement, Bayan Muna Rep.Carlos Isagani Zarate today pointed out one example—-LPG—commonly used for cooking.
“Sa LPG pa lang ay ang laki na ng itataas nito.Sa HB 5636 tataasan ng P3 excise tax ang kada litro ng LPG pagpasok ng 2018.Dadagdagan pa ng P2 sa 2019 at P1 pa sa 2020,” said the progressive solon.
“Kada kilogram sa isang 11kg na cylinder na panluto ay may 1.96 litro ng LPG. Kaya sa 2018 ay madadagdagan ng P64.68 ang P541 11 kg LPG ngayon at ito ay magigibg P605.68 na.Sa 2019 naman ay P648.8 na at P670.36 sa 2020,” added the Davao-based solon.
“Sa ganitong pangyayari ay siguradong magmamahal ang mga pagkain sa mga karinderya at maging sa mga restaurant,” ended Rep.Zarate.
Earlier this week, Ways and Means Committee Senior Vice Chairman Albay Rep. Joel Salceda stressed that the bill’s inflationary effect will be muted. The bill reduces personal income taxes but removes most of the exemptions to the value added tax and imposes higher and new fuel exccise taxes, taxes on sugar and sugar sweetened beverages, among others.
in a press conference after the supermajority caucus Wednesday, Salceda said, pag tiningnan mo po yung inflationary impact hindi po lalampas ng .9 percent if at all, kasi yung VAT ina-absorb naman, downward sloping yung mga demand curve ng mga kumpanya. “
Data from the DOF showed that inflationary effect on food will be at 0.9%, transportation at 2.8%, electricity at 0.7% and for other, 0.6%.
On Thursday, Zarate also warned that that government’s comprehensive tax reform package favors singles over married individuals. “It can be seen that there is a fiscal bias for single professionals while those with dependents are taxed more. “
Data from the Finance Department showed that a taxpayer earning 500000 annually with no dependent gets a tax savings of P52004 should the proposed tax package become law. however this figure goes down for those with 1 dependent (44504) 2 dependents (37004) to as low as 22004 for those with 4 dependents. Taxpayers earning 250000 and less annually are tax free.
taxable income is computed as annual income including 13thmonth pay minus the mandatory contributions (SSS/GSIS, Philheath, Pag-Ibig) mines other exemptions like personal exemptions, additional deduction for dependents and the exemptions for 13th month pay not exceeding 82000.
Ways and Means Committee Chair Dakila Carlo Cua however said that the foregone deductions will be offset by the lower income tax rates that will see compensation income taxpayers get a windfall. The first 250000 if taxable income will be taxfree. ” Sa current system kasi before this law will be passed ang isang individual, ang isang couple may get deductions depending on the number of their dependents. Pero kung isuma total mo lahat ng deduction as against the 250 blanket that will be available to each person, so kung kayo ay mag-asawa sa pamilya ninyo 500,000 ang inyong non-taxable income. So mas dramatically malaking impact ito na magbe-benefit ang iyong pamilya. Kung titingnan mo yung maliliit na nawala compared doon sa malaking lump sum na binigay sa inyo ng gobyerno malaking advantage pa rin ito sa ating mga fixed income earners.”
Salceda also said that the removal of the deductions will make tax administration simpler. “Di mo na kailangang mag-present ng birth certificate, death certificate, annulment certificate, or marriage certificate. Simpleng simple po, 250 plus 82—82 po yung bonus, nire-retain pa rin po non-taxable pa rin yung 82—anything below 250 non-taxable na rin po. So we did away with all the individualized and itemized deduction and made it simpler to administer.”
Salceda explained that the bill adjusted tax rates to catch up with higher incomes. For many years, those in the middle class were taxed the same rates as the rich because they were all in the same tax bracket. “Do you know that that P500,000 was top line, top-rated natin ngayon was established by RA 950 in November 1950 and we haven’t adjusted it. Now under the new leadership we had the balls to adjust it. Kasi habang tumatagal umi-increase yung income nahahabol na po. Marami po sa mga middle class nasa top three. So kaya po inadjust po natin pataas para po maka-ginhawa.”
Salceda says the proposal aligns Philippine personal income tax rates with its regional neighbors.
” Kasi nga ayaw nating mawala yung ating mga professionals, kasi kung itatapat mo sa Malaysia, sa Singapore, sa Thailand, yung kanilang mga tax rates for personal income tax, gusto lang nating tapatan. Imbes na i-align lang natin sa inflation, yung usual na ginagawa namin, all inflation since 1997 kung saan natin inadjust yan, tiningnan natin kung anong ginagawa ng Thailand, Malaysia, Indonesia, tinapatan natin para yung mga best professional ng Pilipinas hindi mawawala sa atin, kasi mas mataas ang take home pay doon kaysa dito sa atin.”
The same tax package also adjusts tax rates for the self employed and professionals.For the self-employed and professionals within the VAT threshold of P5million, the substitute bill requires them to pay an 8 percent tax on gross sales or receipts in lieu of the income and percentage taxes.
The tax for those above this VAT threshold will be based on the 30 percent corporate income tax rate with minimum tax.
(statement Zarate, sots Salceda and Cua from Wednesday)