AS it normally does, the other day Social Watch Philippines (SWP) issued a statement asking presidential candidates a vital and important question.
Prof. Leonor Magtolis Briones (a former Manila Times columnist), SWP’s convenor, asked: “Candidates have made excessive promises in their platforms. How are they going to deliver these promises [they make] to woo the voters? We know lowering taxes is appealing to voters but the people need to know where the next administration will get the money to compensate for the lost revenues.”
The SWP release said this was a question from several civil society groups led by Social Watch Philippines. SWP also shared the results of its and the other groups’ tracking of the candidates’ pronouncements and positions about public financing, specifically on the issues of pork barrel, lump-sum funds left under the discretion of the President, and the sources of government revenues.
“The Supreme Court has made decisions on the pork barrel and lump sums and one of the obligations of the President is to defend the Constitution. Only Mayor Rodrigo Duterte and Sen. Miriam Defensor-Santiago said they will reject all pork barrel and lump-sum funds in any form. That means they are opening 25% of the national budget to public scrutiny when it goes through the Congress deliberations, which should be the appropriate process,” explained Prof. Leonor Magtolis Briones.
Social Watch said Duterte and Vice President Jojo Binay declared to reduce the taxes of lower income groups.
But Sen. Grace Poe and Defensor-Santiago said they would reduce corporate tax. They also said they would reduce the tax rate of higher income groups with P500,000 and above annual income, from 32 percent to 25 percent. “It does not help that this will practically lower the income tax of the elite billionaires’ club which is included in the said tax bracket. Worse, Defensor-Santiago proposed to increase the tax rate of Value-Added Tax from 12% to 19% in 2019 which will definitely render the poor even poorer,” Briones added.
Briones raised the problem of constitutionality in the declaration of Sen. Grace Poe that the determination of tax rates should be left to economists. Prof. Briones said: “We all know that revenue measures should emanate from the House of Representatives, upon the recommendation of the Executive. On the other hand, it is expected that Secretary Mar Roxas will maintain the current policies.”
Social Watch’s monitoring found that VP Binay sees loans as necessary to provide government services; that Defensor-Santiago declared she’d rather get domestic borrowings rather than foreign loans while Roxas said he will exercise prudence in foreign borrowings.
“No one is looking at government corporations that are supposed to remit 50% of their income to the national government; streamlining the brackets for high-earning taxpayers; reform or rationalize excise taxes, investment incentives; and reforms in tax administration and efficient tax collection,” Briones said.
In 2016, the Philippines committed to meeting the Sustainable Development Goals composed of 17 sustainable goals and 169 targets, emphasizing the abolition of absolute poverty in 2030. Social Watch said this poses a big challenge to the next administration and the candidates have been quick to vow bringing relief to the poor, in terms of food, jobs, education, and health.
Briones urged the people to also examine the candidates’ human rights perspective and their plan to reform the tax system, to be sensitive to gender issues.
Specifically, Social Watch is proposing to amend Section 79-F of the National Internal Revenue Code that deems the husband as head of the family on matters of tax exemptions. “What if the father does not have work? The mother, who is practically the head of the family, will not be able to declare their children as dependents without the consent of the father. This is sad, considering that more women than men in the family are the ones working,” Briones said.
SWP said that among the senatorial candidates, only Sen. Panfilo Lacson, Greco Belgica, Rep. Ferdinand Martin Romualdez, and Walden Bello signified their opposition to the pork barrel and all lump-sum funds that are left to the discretion of the President.
These are observations the people should bear in mind when voting on May 9.