By Camille A. Aguinaldo
SENATOR Panfilo M. Lacson on Sunday renewed his proposal to reduce exemptions from the value-added tax (VAT) and lower the VAT rate from 12% to 10% following calls by some senators for the suspension of the fuel excise tax due to rising inflation.
Mr. Lacson opposes the suspension, saying this was a “revenue-erosion” proposal. He said Congress could focus instead on VAT legislation.
“So maybe we can forget about the increase in taxes, let’s concentrate on VAT instead. Of course, that’s the ideal situation,” the senator said in a radio interview.
“We need to study (fuel excise tax suspension) so it’s holistic. It is easy to call for the suspension of excise tax on fuel. But where would you source the losses? For me, to make up for it, let’s reduce the tax exemptions in the VAT,” he added.
Mr. Lacson said the country has a total of 143 VAT exemptions due to special laws passed by Congress, noting this was more than the 111 total VAT exemptions of other Southeast Asian countries combined.
He added that the exemptions were the source of tax leakages, based on his consultations, including with the Bureau of Internal Revenue (BIR).
“This is because the computation is complicated,” he said.
Mr. Lacson said he will file a bill on the matter, after consulting with the Department of Finance (DoF).
“If we lower the VAT to 10% and we reduce VAT exemptions where industries are only benefitted, this will be already be a great help to Filipinos,” he said.
For its part, the House committee on ways and means is open to reviewing the Tax Reform for Acceleration and Inclusion (TRAIN) Law, Representative and committee chairman Dakila Carlo E. Cua said in a radio interview on Sunday.
“Bukas naman tayo sa panawagan na pag-aralan ito and in fact gusto ko rin malaman kung kumusta ang kalagayan ng ekonomiya. (We welcome calls to review this and, in fact, we also want to find out the [effects of TRAIN] on the economy.)” Mr. Cua told DZBB.
“Ang ayaw lang natin ay padalus-dalos natin na ihinto ang TRAIN kasi kung buong batas ang ihihinto natin baka mas dehado pa ang taumbayan (What we’re trying to avoid is hastily stopping the TRAIN as this [step] can be disadvantageous to the people),” he added.
“Hindi pala iyong buong 4.5% ang naidulot ng train kundi iyong 0.4% lang. So kung ating pag-iisipan, saan nanggagaling iyong ibang pagtaas ng presyo? So iyan ang pinag-aaralan natin ngayon (TRAIN alone did not result in the 4.5% [inflation], but only 0.4% of it. So if you think about it, where did the other price increases come from? That’s what we should be find out),” Mr. Cua also said. — with Charmaine A. Tadalan

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