SENATE deliberations on a counterpart measure to extend the period for the estate tax amnesty prompted solons to raise the possibility of altogether abolishing the tax.
The latter, however, also prompted Sen. Maria Lourdes Nancy S. Binay to offer cautionary words, believing the time is right for the Marcos government to consider the merits and demerits of abolishing estate taxes in the Philippines.
At the hybrid hearing of the Senate Committee on Ways and Means last Friday regarding bills proposing to extend the amnesty availment of paying estate taxes, Binay highlighted the arduous experiences of citizens, especially the middle class, in settling their estate taxes.
“Maybe we need to discuss and study to do away with estate taxes, not only because the government finds it burdensome to collect but also, in a way, heirs of properties will pay capital gains tax when they take ownership of their inheritance,” the veteran lawmaker said. Binay also observed many taxpayers found it hard and stressful to comply with paying the required estate taxes, especially if heirs find out they have to dole out cash when their inheritance is real estate and is illiquid.
This developed as Senator Sherwin T. Gatchalian, presiding chairman of the Ways and Means Committee hearing, proceeded to tackle various options extending the period of availing the estate tax amnesty.
While he supports the proposed measures, Gatchalian pointed out that “the essence of amnesty diminishes if the government will keep on extending its deadline.”
As the presiding chairman, Gatchalian was keen to “know the difficulties and complications” that taxpayers experience in availing the estate tax amnesty and solutions to these problems.
“The reason why the first round of the estate tax amnesty program was successful was because people thought this was the only amnesty,” the senator said. “So, if we extend it now, the whole essence of the amnesty will not be there anymore because we keep on extending.”
Gatchalian added “there must be a valid and compelling reason why we are extending for the second time.”
At the same committee hearing, Sen. Robinhood C. Padilla pressed for a clarification from the Bureau of Internal Revenue on related bills filed to extend the availment of estate tax amnesty, asking if the proposals would benefit the family of President Ferdinand R. Marcos Jr.
Padilla proceeded to specify he was referring to the decision of the Supreme Court on the unpaid estate taxes of the Marcoses since 1991 that ballooned to an estimated P203 billion.
“Will the family of President Marcos benefit from this bill, as critics have been claiming?” Padilla asked Assistant Commissioner Larry M. Barcelo of the BIR Legal Service.
Barcelo noted that the current bill carries the same restrictions and limitations provided under Republic Act (RA) 11213 or the Tax Amnesty Act and RA 11568 or an Act extending the Estate Tax Amnesty, including the basis for availment.