HOW do we greet the new year? Let’s be a bit creative, if not funny, sarcastic even: Happy New Excise Tax!
For starters, the increased excise taxes on cars that will take effect in 2018 are but a portion of the Congress-approved tax-reform package also wholly known as TRAIN (Tax Reform for Acceleration and Inclusion).
Signed into law last week by President Duterte, the TRAIN aims to raise taxes in this revenue-needy government—a result of a not-so-good, albeit imperfect, ways of running the economic engine by not just the immediate past administration but also by those that preceded it. God, will this malaise finally come to an end under Du30?
It sucks, indeed, that before Mr. Duterte’s reign, those who had ruled—most of them, anyway—were guided not by the public’s welfare but by how their pockets would get lined up by you-know-what.
A friend of mine admitted to being a victim—a willing victim, I should say—of the corrupt system that he said he got sucked into a couple or so administrations ago, quoting a colleague of his as telling him upon assumption of a high-profile position: “Let’s rake it in as fast as we could! You won’t know how long we will be here.”
Who was that top gun who said to the factotums: “Hey, steal, but have some decency naman, please? Moderate your greed!”
Mercifully enough, the present dispensation has seen enough of the wicked ways spawned by power in the highest and mightiest of places, so that reforms—hopefully real ones, finally—are on the way.
The TRAIN could yet be the answer, if not a major trigger to, yes, accelerate concrete reforms to better the lives of our people.
How many times has it been that all we need to “get to the promised land” is a firm, unbending and conviction-powered political will, emanating from the very core of the corridors of power?
But promising as it appears to be, the TRAIN has also incurred some misgivings from some, if not the ire of several.
“We will now start to recast everything,” said Alfred Ty, the vice chairman of Toyota Motor Philippines and chairman of Lexus Manila. “From pricings to projections, it’d be a different ball game altogether.”
In a nutshell, the new excise tax for vehicles next year will mainly benefit buyers of high-end cars but not those purchasing the low-end varieties like the bantams and the middle-class type stuff.
It’s like this: New taxes had been raised from vehicles priced from P500,000 plus up to about P2 million up.
But, lo and behold! Taxes for the high-end variety had been decreased, putting to naught projected earnings by speculators who ordered/bought vehicles in advance in anticipation of TRAIN-triggered gargantuan taxes. But some scrupulous businessmen can still escape huge losses, though, by withdrawing their orders.
“Orders aren’t consummated sales deals,” said one high-ranking officer from a high-end vehicle sector. “You can’t force one to go into a losing proposition.”
Aside from cars, other goods affected by the TRAIN include, among others, petroleum products (P5/liter increase in diesel?), alcohol-spiked drinks, tobacco and sugar-sweetened beverages.
The new taxes will hurt the buyers’ pockets, yes, but on another plane, the measures are expected to generate P130 billion in revenues to our cash-starved government. Surely, that amount would tremendously help finance badly needed infrastructure programs that would, in the long term, redound to a better life for the Filipino people.
And, are we going to commend Sonny Angara, the chairman of the Ways and Means Committee running for reelection in 2019, for leading the passage in the Senate of the controversial bill, which will also—on a positive note—exempt those earning P250,000 a year from paying the income tax?
It would definitely mean a bigger take-home pay among salaried employees. But then, how would they cope with increased prices of prime commodities again as an offshoot of jacked-up fuel prices? The tyranny of cycle once again at work.
A little sacrifice could do wonders for us, if not for generations to come. No pain, no gain?
Surely, the new tax on cars will deter, if not stop, the lower-class sector from buying their dream cars beginning 2018 and even beyond.
This early, Rommel Gutierrez, the president of the Car Association of Manufacturers in the Philippines Inc., has made the grim forecast of “zero growth” in sales in the coming year.
“It appears bleak in 2018, but let’s roll with the punches in the name of progress,” he said.
And to repeat what Satoru Suzuki, the TMP president, has said to this writer at the sidelines of the recent Tokyo Motor Show: “We will learn to live with the times. Anyway, the demand for cars in 2018 had already been registered this year, 2017.”
How positive can one get.
Happy New Year!
PEE STOP It is not true that car lover Ramon S. Ang, fondly called RSA, has also bought Kia, a kid sister of BMW’s. While RSA, president/CEO of San Miguel Corp., had earlier acquired BMW, not Kia. “Not true, Sir,” he said to me. Always, that’s the standard way that RSA would reply to queries via text. The ubiquitous “Sir” decorating the end of every reply of his. How many billionaires can be like him? Humble to the max? Happy New Year, Sir!