I didn’t believe it was going to happen. But I’m not really happy that it didn’t.
For a while there, I thought the tide had really turned as far as the opposition of President Noynoy Aquino to the reduction of personal and income taxes was concerned. Like many, I thought that when administration bigwigs like Senate President Franklin and House Speaker Feliciano Belmonte started to get behind the proposal to reduce tax rates that had originated in both their chambers, that there was hope for the salaried workers in the formal sector.
You know, people like you and me who get hit all the time by the confiscatory tax regime that has been with us for more than two decades which, to be fair, was not invented by this clueless administration. I’m talking about the millions of workers who get taxed at the source for their income and get taxed again when they spend what’s left of what they’ve earned.
Aquino told the Foreign Correspondents Association of the Philippines, with finality, that there wasn’t going to be any income tax reduction. There probably isn’t going to be any indexation of taxes, or adjustment of tax brackets for inflation over the 18 years that the current tax scheme has been in effect, either.
“We’re still operating under a budget deficit,” was the President’s latest excuse. “Perhaps if we’ve been enjoying a surplus for the past few years, then I think we can sit down and talk about it.”
But should taxpayers be penalized for causing a budget deficit that they did nothing to bring about? Of course not.
No government in recent memory, especially not in this country, has ever erased the budget deficit. And a deficit (or the disparity between budgeted expenditures and actual revenue collected) is created—in the Philippine context, especially—when revenue-generating agencies like the Bureau of Customs and the Bureau of Internal Revenue don’t make their collection targets.
In other words, the economics major President is saying that the taxpayers should get no relief because his own officials have failed to collect enough for government to pay for its programs. It might as well be the taxpayers’ fault that government can’t find the means to pay for its upkeep.
It wouldn’t hurt so bad if Aquino didn’t also aggravate the deficit by underspending the funds that he had already collected from us, the taxpayers. But that’s exactly what Aquino did, when he allowed the underspending of P500 billion in government funds which his beloved Department of Budget and Management then hoarded as savings.
And that, apparently, is that. So “just pay the taxman” is the unmistakeable message, for the incompetence of government and for its avaricious and miserly stockpiling of funds that it doesn’t know how to use.
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Maybe it’s just me, but I suspect that Aquino is just trying to find another excuse not to grant tax breaks to the oppressed wage earner. After all, it’s the first time I’ve heard him use the budget deficit as the reason for not giving us some of our money back.
Prior to the deficit excuse, Aquino was saying that granting tax breaks would jeopardize the Philippines’ credit rating. And what on earth does any government need a good credit rating for, if not to borrow more money that this administration will, if history is any indicator, once again fail to use?
(Aquino’s anointed successor, Mar Roxas, also deserves special mention here, for saying that a tax break would lead to loss of government services. But then, Mar had already warmed up to the idea of tax breaks, as well—until Aquino shut down any hope for them during his Focap speech.)
I have stopped trying to find a reason why Aquino refuses to give wage earners any relief by way of reducing taxes—or even adjusting them for inflation. Maybe it’s just his usual orneriness, which comes into play especially when someone else (Congress, in this case) comes up with an idea that could benefit a lot of people, like reducing income taxes for both individuals and businesses.
Whatever his motivation for not reducing taxes, it can’t be because he has the interest of the public in mind. After all, if even his most rabid supporters like Drilon, Belmonte and the self-confessed Malacañang “sipsip” who is chairman of the House ways and means committee, Marikina Rep. Miro Quimbo, are calling for lower taxes, you’d think that Aquino would give in a little—even in the small matter of updating tax brackets because of the ravages of 18 years of inflation.
I really don’t know why Aquino acts the way he does, come to think of it. I’m just happy that, in a few months, I won’t have to even attempt to explain to anyone why he does it.
I simply don’t have the psychoanalytical training for it. And, quite frankly, I’ve just given up trying.