FORMER Finance officials have expressed support for the original tax legislation proposed by the Department of Finance (DoF), saying that the government needs the funds to meet greater obligations starting in 2018.

Following the release of the Finance department’s P59.9 billion initial revenue estimate for the first year implementation of the Tax Reform for Acceleration and Inclusion Act (TRAIN) under Senate bill No. 1592, the department solicited the support of ex-Finance Secretaries.

These include former Secretaries Roberto F. de Ocampo, Margarito B. Teves, and former Finance Undersecretary Romeo L. Bernardo, who are members of the Foundation for Economic Freedom (FEF).

Mr. Bernardo said that he wants the bill to “preserve as much as possible the original revenue requirements,” noting additional costs faced by the government in 2018 such as the free tuition for state universities, higher pensions for uniformed personnel and retirees, the rehabilitation of Marawi City, and the government’s infrastructure projects.

The Senate version will generate lower revenue compared with  the P157.2 billion in the DoF’s original version of the legislation and the P133.8 billion to be raised by the approved House Bill No. 2636.

Such estimates have since been revised to P149.6 billion for the DoF proposal, and P119.4 billion for the House version.

Mr. Teves meanwhile noted that the higher revenue estimates will “enable the government to finance our growing needs as a developing country, such as accelerating infrastructure development, closing the gaps in health and education and improving social protection programs for the poor and marginalized.”

The statement quoted Mr. de Ocampo as saying that the measure would “improve tax compliance, and bring in more investment that would create more jobs, thus benefiting the country’s underprivileged sectors.”

FEF said “it believes that the comprehensive tax reform program will allow every Filipino an equitable opportunity to contribute to a sustained and truly inclusive economic growth.”

The variation in the revenue computations is mainly due to the number of value-added tax (VAT) exemptions. The House and DoF version yielded P62.3 billion and P60.9 billion, respectively, while the Senate yields only P14 billion.

The Senate retained VAT exemptions for electric cooperatives, and socialized housing for units worth less than P2 million, and located outside Metro Manila.

The Senate bill also had a lower personal income tax-exempt salary threshold at P150,000, against the House’s P250,000, and the annual incremental increase of fuel excise taxes at P1.75, P2 and P2.25 per liter over the next three years, against the House’s P3, P2 and P1 scheme.

It also proposed an excise tax at P10 per liter for beverages sweetened by High-Fructose Corn Syrup, P3 per liter for non-caloric sweeteners and P5 per liter for caloric sweeteners, against the P10 per liter flat rate regardless of sweetener content under the House and DoF proposals.

It also seeks new measures outside the original DoF proposal — imposing a P20 excise tax per metric ton of coal; 20% ad valorem tax on cosmetic surgery, a higher 20% tax on foreign currency deposits, dividends and capital gains tax on shares not traded on the stock market from the current 10%. — Elijah Joseph C. Tubayan

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