Tax-reform critics challenged to submit alternative proposals

Instead of their continued criticisms over the government’s tax-reform program that seeks to fund health care and education, groups, like Bayan Muna and Freedom from Debt Coalition, should come up with proposals on how to finance the said programs, the Action for Economic Reforms (AER) said over the weekend.

“These critics oppose the proposed excise tax on fuel, tobacco and sugar, but they don’t propose concrete solutions. They demand efficiency in tax collection, yet, they resist the reforms that will improve collection, like the broadening of the value-added tax [VAT] base and the adjustment of fuel taxes to inflation,” said AER, the group that first lobbied for the legislation of the “sin” tax that became law in 2012.

According to Jo-an Diosana, the critics are correct in calling for taxing the rich, but they are not aware that the revenue from taxing the rich, which the tax reform in fact includes, will still be insufficient to meet the revenue goal to fund AmBisyon 2040, adding, “all citizens have a responsibility to pay taxes, with those having the ability to pay having to pay more.”

Diosana said the critics are opposing the tax reform, but “they want money for free public education, universal health care and modernization of public mass transportation.”

According to Diosana, funding health care, education and social protection is most urgent.

At the same time, the reduction in personal income-tax rates, which will provide relief to the middle class and working class and other income earners, will cut revenues by P141.4 billion.

“There is no escaping tax reform, to fund the development requirements, to recover revenue losses from the personal income- tax relief and to correct the weaknesses of the tax structure,” she added.

Diosana said her organization is, thus, calling on all civil-society organizations to change their old approach and  take the opportunity to secure tax reform that will fund government’s programs, especially on education, universal health care, social protection and pro-poor infrastructure.

“Statements and actions critical of the tax reform bring publicity but on their own, without concrete, feasible proposals, they’re unlikely to bring about the progressive change in the tax system,” she said.

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