Foundation Dialogue, on its 3rd installment, tackled the pros and cons of the Tax Reform for Acceleration and Inclusion (TRAIN) Law and its effects on the economy last September 26 at the Sofia Soller Sinco Hall.
Different viewpoints were expressed by three speakers namely: Leonardo Magalso, a certified public accountant and a revenue officer at the Bureau of Internal Revenue; Sonny Africa, economist and executive director of IBON Foundation; and Jan Shaira Malicay, a senior accountancy student from Foundation University College of Business Administration.
Magalso began expressing his standpoint on TRAIN Law by mentioning the tax exemptions enjoyed currently by those who belong to the bracket of income earners below P250,000.
TRAIN, as Magalso described, is meant to create a simple, fair and even more efficient system when it comes to tax revenue enhancement where the rich contributes larger amounts while the poor will be of benefit from the government’s programs and services.
He made mention of the many components including the raising of excise tax on petroleum products, automobile unit purchases and sweetened products are meant to impose more taxes on the wealthy populace. Statistics have shown that more than 51% of the fuel consumption comes from the rich populace.
TRAIN revenues will support the Build, Build, Build Program of the Duterte administration as well as the continuation of the conditional cash transfer program commonly known as 4Ps or the Pantawid Pamilyang Pilipino Program under the umbrella of the Department of Social Welfare and Development.
On the other hand, the next speaker, Africa, opened his statement with his description of TRAIN Law as simple but worst and is basically, an anti-poor scheme. He represents IBON Foundation, a research-education-information development institution whose undertaking revolves around the study of socio-economic issues confronting the Philippine society and the world today.
With data coming from the Department of Finance, Africa made mention that the conclusions were based on their data and said that it may vary but will stand to what their organization’s analysis.
Africa mentioned that TRAIN law is not a progressive reform as claimed by its proponent and implementing bodies. Progressive would mean the rich pay more and the poor, pay less. As he pointed out, out of 23 million families, 7.5 million are taxpayers which include two million who are minimum wage earners so in reality, 5.5 million turn out to be taxpayers who are now enjoying the personal income tax cuts thus, leaving 17 million families who do not gain any benefit from the said law.
The 17 million populace, according to Africa, do not possess money in their pockets but pay higher consumption taxes thus, leaving the majority of the poor with the tax burden.
Pointing to the infrastructure programs which most of the TRAIN Law proceeds will be spent, Africa said it was not for the poor because more of the projects are concentrated in the National Capital Region and knowing the fact that the poorest provinces are in the other regions outside of the country’s capital.
When asked on what needs to be done with the law, Africa pushes for the suspension of its implementation and at the end of his talk, he concluded that TRAIN Law has a large part played why the Philippines is experiencing the worst inflation rate in Asia.
Meanwhile, Malicay, the student reactor, pointed out the benefits of TRAIN Law in the improvement of universal healthcare for the Filipinos. She also pointed out the jobs that could be created for those who have less opportunities for work through the infrastructure projects which will employ more skilled workers.
Added to that, Malicay also mentioned the effect of the tax reform to the development and improvement of the agriculture industry as well as the enhancement of the educational institutions when the next packages are to be fully implemented within a span of 3 to 5 years.
Foundation Dialogue provides an avenue for discourse and sharing of thoughts on relevant issues and topics affecting the lives of the whole populace.