Makabayan bloc asks SC to strike down tax reform law

Lian Buan
(UPDATED) Leftist lawmakers argue that the House had no quorum and did not call a vote when it ratified the joint bicameral conference report on the Train bill

JUNK TRAIN LAW. Bayan Muna Representative Carlos Zarate, ACT Teachers Representative Antonio Tinio, and Anakpawis Representative Ariel Casilao file the petition before the Supreme Court on January 11, 2018. Photo by Ben Nabong/Rappler.

MANILA, Philippines (UPDATED) – Leftist lawmakers on Thursday, January 11, asked the Supreme Court (SC) to strike down the Tax Reform for Acceleration and Inclusion (Train) law.

In their petition, the lawmakers from the Makabayan bloc also asked the High Court to issue a Temporary Restraining Order (TRO) against the law which took effect on the first day of 2018. (READ: EXPLAINER: How the tax reform law affects Filipino consumers)

The petition is anchored on the argument that the tax law bill was invalid because there was no quorum when the House of Representatives ratified the joint bicameral conference report on the measure, and there was no voting involved.

The respondents in the petition are President Rodrigo Duterte, Speaker Pantaleon Alvarez, Majority Leader Rodolfo Fariñas, Deputy Speaker Raneo Abu, and Deputy Majority Leader Arthur Defensor Jr.

The petitioners are ACT Teachers Representative Antonio Tinio, Bayan Muna Representative Carlos Zarate, and Anakpawis Representative Ariel Casilao, represented by the National Union of Peoples’ Lawyers (NUPL).   

Zarate expressed confidence that the High Court would grant their petition, based on the grounds they cited.

“Nandoon pa rin ang ating paniniwala na ang inihain nating petisyon ay may malakas na tungtungan constitutionally, even sa rules na sina-cite namin. Kaya nananawagan kami na tingnang mabuti ito ng Korte Supreme,” he said.

(We still believe that the petition that we filed stand on strong ground, constitutionally, even the rules that we cited. So we ask the Supreme Court to take a good look at this.)

Zarate added that their petition also serves as a preventive measure for potentially anti-poor tax reform laws, considering that the Train law represents just the first package of tax laws under the Duterte administration.

“Unang pakete pa lamang ito ng Train, at nakita na natin ang rumaragasang epekto nito sa ating mga kababayan, taliwas sa naunang sinabi ng administrasyon na minimal daw ang epekto nito,” he said.

(This is just the first Train package, and we have seen the immediate effects on our people, contrary to what the administration’s earlier statement that it will have minimal effects.)

Grounds

Under Section 63, Rule X of the Rules of the House of Representatives“a conference committee report shall be ratified by a majority vote of the Members of the House present, there being a quorum.”

Petitioners provided links to official videos and photos that would show there was no quorum “with barely 10 people on the floor.”

“On top of the utter lack of the requisite quorum, the second equally important requirement – the majority vote – was also not met.  A vote, whether viva voce or nominal, was not taken,” the petitioners said.

The official video of the process shows Tinio and Zarate repeatedly objecting to the ratification, but Abu and Defensor continued with the process until the voices of the petitioners were no longer heard because the microphone had been turned off.

Duterte’s House allies were not present during the ratification on December 13, because they attended the PDP-Laban Christmas party in Sofitel in Pasay City.

Aside from the House rules, the petitioners said Section 16(2), Article VI of the Constitution that requires a quorum was also violated. The petitioners said these are grounds to support their argument that the ratification of the bill is invalid.

“There was grave abuse of discretion on the part of Respondent President when he enacted the Train bill which was not passed by Congress,” reads the petition.

Watch how the House ratified the bill here, fast forward to the last two minutes:

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Why against Train?

The Makabayan bloc authored two House bills that aimed to reduce personal income tax, and restructure tax brackets to benefit the working class.

However, their bills were consolidated with the bills of Quirino Representative Dakila Cua and Albay 2nd District Representative Joey Salceda which proposed new excise taxes on petroleum products. The consolidated bill also included provisions on new taxes on minerals and coal and select cosmetic surgical procedures.

The leftist lawmakers withdrew support for the bill and fought against its passage, as they believed that the new taxes will negate the gains of a lower income tax since these would lead to higher prices of goods and transportation fares.

“Train’s new excise taxes on petroleum products and sugar-sweetened beverages, and its broader Value Added Tax (VAT) will ultimately be borne by the people, especially the poor and low-income earners,” the petitioners said.

The petitioners pointed out that since informal workers and minimum wage earners did not pay income tax prior to the enactment of the tax reform law, they would not benefit from lower income tax. Instead, they will carry the burden of higher taxes and service rates.

“Petitioners plead now for the Court not to allow a law further expanding oppressive taxes which are antithetical to a constitutional mandate, especially when such law was ‘passed’ by Congress when it was in no position to pass it, then signed by the President when he had no authority to sign it,” the petition said.

Despite its repeated assurance to the public that the new tax reform law would not have an impact on the poor, the government itself had acknowledged this by setting aside funds to offset the ill effects of Train on the poor.

On Wednesday, January 10, Budget Secretary Benjamin Diokno announced that the poorest 10 million households will receive P200 per month from the government to help them cope with new taxes. – Rappler.com

Lian Buan

Lian Buan covers justice and corruption for Rappler. She is interested in decisions, pleadings, audits, contracts, and other documents that establish a trail. If you have leads, email lian.buan@rappler.com or tweet @lianbuan.