Senate President Aquilino “Koko” Pimentel III on Tuesday called on his colleagues and the Department of Finance to be “open to compromise” on the proposed tax reform package being pushed by President Rodrigo Duterte.
Pimentel issued the statement after Duterte appealed to the Senate during his second State of the Nation Address to pass the package “in full.
“Everyone should be open to compromises. No one has monopoly of knowing the real sentiments of the people,” said Pimentel. He said “senators should also be sensitive to the sentiments of the people, but not all l organized groups represent the people. Some represent their own selfish interests. This is what we should be conscious of,” added Pimentel, president of the ruling PDP-Laban.
Senate ways and means committee chairman Senator Sonny Angara, who is conducting hearings on Duterte’s proposed tax measure, yesterday said he is willing to resign from his committee if his fellow senators will not be satisfied with his version of the new tax reform package.
“If the [Senate] can’t fulfill what they wanted in full, maybe we could take remedial action. Like if they want me to resign, I would resign because there are really aspects in the version that are not acceptable,” Angara said.
“That’s something we have to discuss with the Senate President and our colleagues,” he added. “If they’re not happy with the version they’re coming up with, we’re willing to resign our position. I will not cling to the position.”
On Monday night, Angara also told reporters he will quit his Senate post if the President would ask him to do so.
He said Duterte’s proposed tax package would generate for the government an additional taxes amounting to P150 billion a month.
In his Sona, Duterte pushed for the approval of the tax reform package in the Senate. He noted that the fate of the tax reform is now in the hands of the Senate. “What do you want me to do, kneel before you! Well, really I’ll leave it up to you,” he said.
The proposed tax reform measure of the Duterte administration seeks to lower income taxes while limiting VAT exemptions, adjusting excise taxes on oil and automobiles, and imposing new taxes on sugar-sweetened beverages.
But some senators have expressed apprehension on the lifting of VAT exemption on low-cost and socialized housing, as well as the “anti-poor” proposal on SSBs and oil.
The tax reform measure has been approved by the House of Representatives but remains pending in the Senate.
The President even put on the spot some senators whom he said were not clapping on hearing his statement on the new tax package. “You don’t like to clap [your hands]—even… they are not clapping so. Angara is not clapping. You watch during election, you will see,” said Duterte, referring to Senator.
Angara, who is running for reelection in the 2019 polls, earlier said he considers Duterte’s remark both as a “joke” and a “threat.” Macon Ramos-Araneta
At first, Angara told reporters that Duterte just appeared to be joking.“You know the President, he was always joking so he asked us to pass it in full so I have to discuss that with my colleagues because many of my colleagues have expressed reservations over the tax bill. We will talk if we can take it in full because there are really aspects that I felt were not debated enough,” he added.
But when asked if he considers Duterte’s remarks as also a threat, Angara said, Perhaps, if we don’t pass it in full, maybe we won’t be in the good graces of this administration. It is what it is.”
“I feel a little bit pressured because it is a priority measure. We must learn to interact with the Executive branch to come up with a bill that is pro-people.”
Angara’s committee has been holding weekly hearings on the different aspects of the tax reform proposal for the past few months.
Aside from Angara, other senators have expressed reservations on the proposed tax on sugar sweetened beverages, the lifting of value-added tax exemptions on housing, and the adjustment of excise taxes on oil.
Duterte claimed his government’s tax reform proposal is “pro-poor especially when the people understands how the revenues will be spent.
Senator Panfilo Lacson, meanwhile, said that he believes that increasing taxes should be tied to expenditure, or the capacity of government to utilize the budget.
“I said that because government is still underspending under the Duterte administration,” he said.“For 2016 alone, unused appropriations hit more than half a trillion pesos, P589,293,569,000 to be exact. Why should we punish our people with additional taxes when government cannot spend efficiently to spur development anyway?”
Sen. Bam Aquino, on the other hand, assured the public that the Senate will put the tax reform package being pushed by the Duterte administration under the microscope, saying lawmakers owe it to the people.
“When it comes to tax reform package, there would be long debates on this,” said Aquino, vice chairman of the Committee on Ways and Means. “We owe it to the Filipino people to scrutinize because at the end of the day, prices will spike.”
Aquino said that the Senate cannot just accede to the President request to pass the tax reform package in total. He warned that the government’s plan to impose excise tax on liquefied petroleum gas, gasoline and diesel under its tax reform package will lead to higher prices of commodities.
“The excise tax on LPG, gasoline and diesel will raise prices eventually. It might be inflationary because everything is transported. This will affect the pockets of our countrymen.”
But he said he supports the move to reduce personal income tax rate, saying it was part of his advocacy when he became a senator. “It is not right that 32 percent tax would be deducted from the income of a CEO and his/her secretary,” said Aquino.
In the 17th Congress, Aquino had filed Senate Bill No. 697 that seeks to revise the current income tax bracket set by the National Internal Revenue Code, which was passed in 1997. The measure seeks to amend Section 24 of the National Internal Revenue Code of 1997, as amended, by adjusting the levels of net taxable income and simplifying the nominal tax rates for the purposes of computing the individual income tax.
Senator Loren Legarda said the new tax package will result to good infrastructure, good transport system, better health and social services, support for the farmers, the poor, and the senior citizens require money.
“This (tax) reform will help achieve equity – those who have more should pay more. However, in pursuing these reforms, we also need to demand efficiency and integrity from our tax collectors,” said Legarda, chair of the senate committee on finance, foreign relations and climate change.
