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Tollway VAT an additional burden to the poor, another betrayed promise of Noynoy – Anakbayan

July 22, 2010

Youth group Anakbayan criticized the Aquino administration today over the latter’s intention to impose the VAT (Value Added Tax) on toll ways nationwide, calling it ‘yet another broken promise’ by the three-week old regime.

The measure, which will take effect on August 16, is expected to raise P1 billion a month, according to Bureau of Internal Revenue (BIR) commissioner Kim Henares.

“Noynoy has been in power for less than a month, and he has already turned his back on many of his campaign and pre-inauguration promises and pronouncements” said Anakbayan national vice-chairperson Anton Dulce.

In a speech made by Aquino to the Makati Business Club last January 21, he said he would not resort to raising existing taxes, or implementing new ones, to raise more funds for the national budget.

“Tens of thousands of college students and workers use the NLEX and SLEX (Northern and Southern Luzon Expressways) to commute from their schools and places of work in Metro Manila to their homes every weekend. The corresponding increase in bus fares will be a further strain to their already-meager finances” said Dulce.

The youth leader added that the tollway VAT will also lead to increases in the price of agricultural products, such as vegetables and fishes, which are delivered from the countryside via the same expressways.

He added that there were other ways to raise gov’t funds which would not affect the income and livelihoods of millions of poor Filipinos.

“Noynoy should carry over his anti-Arroyo rhetoric to the issue of taxation. He should seriously consider the alternatives to the VAT which his predecessor ignored” said Dulce.

In 2005, former president Gloria Macapagal-Arroyo raised the VAT from 10 to 12% and expanded its coverage of goods and services despite nationwide massive protests against it. Among the proposals by critics of the VAT is the scrapping of tax exemptions for large corporations. According to former Finance Secretary Juanita Amatong, the government lost P229.4 billion in 2003 alone in potential revenues due to such tax exemptions.

Another proposal by then-Paranaque representative Eduardo Zialcita estimated that renegotiating the country’s foreign debt payments could lead to up to P200 billion in additional funds for the government.

The National Tax Research Center meanwhile computed that around 20-30% of the national budget is wasted due to corruption.

“Does the tollway VAT move mean that the Aquino administration is admitting it cannot eliminate corruption and save money? Or is it an admission that its walang corrupt, walang mahirap campaign rhetoric is unrealistic” quipped the youth leader.

 

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