Prioritize public needs over credit ratings, Angara tells gov’t

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Prioritize public needs over credit ratings, Angara tells gov’t
The senator questions the government's priorities in the face of its refusal to lower taxes

MANILA, Philippines – Following Malacañang’s rejection of the proposed lower income tax rates, Senator Juan Edgardo “Sonny” Angara called on the government to prioritize the people’s needs over revenue. (READ: Palace: No new or higher taxes, income tax cuts

Senator Angara questioned government’s priorities given that the proposed budget of the Department of Finance (DOF), the Bureau of Internal Revenue (BIR) and the Bureau of Customs (BOC) jumped to P50 billion ($1.07 billion) next year from P15 billion ($322.8 million) this year. (READ: P3 trillion: PH’s biggest nat’l budget submitted to congress)

“I don’t think the government has no fiscal capacity to lower taxes given that the Department of Finance (DOF) is asking for a budget increase that is bigger than the P30 billion ($645.6 million) projected revenue loss once we lower our income tax,” said Angara in a statement on September 20.

President Benigno Aquino III previously stated that the government deficit would increase if lower income taxes were imposed due to the loss of government revenue. This in turn would have a detrimental impact on the country’s credit rating. (READ: Lower income tax rates? Aquino ‘not convinced’ its a good idea’)

Angara, chairman of the Senate ways and means committee and is the leading proponent of a bill seeking to lower income tax rates, said: “Lumalabas po sa ating pagtatanong na tumalon ng 224 porsyento ang hinihinging pondo ng mga kagawarang ito. Kung sa tingin nila ay kakayanin ng gobyerno ang ganito kalaking pondo, bakit hindi nila kayang ibigay ang kakarampot na balik-kita sa tao sa pamamagitan ng mababang tax?” Angara said. (It came out from our questioning that these government agencies are asking for a 224% increase in funding. If in their opinion the government can support  a level of funding this high, why then can’t the government give back a scanty amount of income to the people through lower taxes?)

He pointed out that the Congress has even expressed its openness to compromise by simply adjusting the present tax brackets for inflation instead of reducing the prevailing tax rates outright.

The brackets have been left unchanged since 1997.

“Indexation na nga lamang ang hinihingi natin kung ayaw nilang babaan ang tax. Ayaw pa rin. Pero ang nakakapagtaka, itong mga mismong ahensya na tumututol sa ating panukala, sila pa ang nangunguna sa paghingi ng napakalaking pondo para sa kani-kanilang tanggapan,” he added. (Right now we are only asking for indexation. They [the Aquino Administration] still won’t accept it. What is interesting is that the agencies that who protested our proposal are the same ones that the first to request for very big funding.)

Billions in increased funding for agencies

“Ang pinag-uusapan natin dito, bilyon-bilyon. Pero tignan naman natin, ang ibabalik lang naman nating pera halimbawa sa isang public school teacher ay P800 ($17.21) kada buwan. Bakit kailangan nating pagdamutan? Kailangan daw ng BIR ng bagong gusali. Paano mo gagastusan ang pagpapatayo ng bagong gusali? Ang gagamitin mo dyan, pera ng tao na pinagdadamutan mo,” Angara said.

(We are talking about billions of here. But if you look at the amount that will be returned to a public school teacher every month, it will come out to P800 ($17.21). Why do we need to shortchange them? The BIR needs says it needs a new building. The money to be spent on that will be come from the people who have been shortchanged.)

Other agencies, with proposed budget hikes is the Office of the Secretary, whose P900 million ($19.36 million) budget this year jumped to P2.6 billion ($55.92 million) next year, while the BIR’s present P7.9 billion ($169.9 million) budget will be increased to P11.3 billion ($243 million) next year, Angara pointed out.

The lawmaker also questioned the proposed P30 billion budgetary support next year for the Land Bank and Development Bank of the Philippines.

The increased support for the two banks, which are already posting profit, is not urgent, he shared.

“Unahin natin ang tao. Huwag muna nating isipin ang kapakanan ng iba lalo na ang mga kumikitang ahensya; huwag muna nating isipin ang credit rating. Gawin nating prayoridad ang kapakanan ng ating mga kababayan. Pag may perang panggasots ang tao, naturalmente, babalik din ang kita sa gobyerno,” Angara emphasized. (Let’s prioritize the people over the agencies who are profiting. Let’s not prioritize credit ratings. If people have money to spend, the money will naturally flow back to the government.) – 

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