PRESIDENT Benigno Aquino 3rd has not ruled out the possibility of lowering the workers’ income tax, Executive Secretary Paquito Ochoa, Jr. said Thursday.
Ochoa made the stance when the Office of the President presented its proposed P2.8 billion budget for 2016 before the House Appropriations panel.
It was earlier reported that President Aquino scolded his allies in Congress who are pushing for the lowering of income tax rates by revising the income tax brackets. Under the proposed tax bracket, those earning 180,000 and below annually are exempted from paying taxes, while those who annually earn above 180,000 to P500,000 will pay nine percent. Individuals whose yearly income is above P500,000 to P10 million will pay 17 percent, while those with more than P10 million annual income will have to pay 30 percent.
The following rates are based on family and income expenditure survey, labor force survey and census.
“I don’t think the President is mad about that issue, your Honor. What the President has said is (that) before we cut (on) taxes, there should be a compensatory measure, and that is being discussed now,” Ochoa said in response to House Deputy Minority Leader Neri Colmenares of Bayan Muna.
If the bill on lowered income taxes will be passed into law, the projected revenue loss stands at P29 billion.
Given such figure, Colmenares then lamented that the Aquino administration would easily allocate P30 billion budget for Risk Management Program under the proposed P2 trillion budget for 2016 as sovereign guarantee to private companies which bagged government contracts rather than shelling out funds for the benefit of the citizenry it is mandated to serve.
“This value of sovereign guarantee is mind-boggling. The workers are overtaxed, and the BIR (Bureau of Internal Revenue) would just dismiss it and say it’s the people who should look for fund sources for the lowered income tax. This is an unjust system and this administration wants it continued just because there is not fund [to compensate for the P29 billion],” he stressed.
“We are giving billions to billionaire concessionaires, and yet we don’t have money for our people,” Colmenares added.
Ochoa, a lawyer, however, noted that sovereign guarantees are just standby funds that bring benefits to the country as well.
“Sovereign guarantee is allowed by law, your Honor, and it is part of the reasons why we are able to get credit from various international [fund]sources,” he added.