• The tax of the matter

    5
    Carla Bianca V. Ravanes

    Carla Bianca V. Ravanes

    Among the least topics that cross a youth’s mind is the country’s tax issue.

    Things, however, are about to change for the younger generation as the impressionable Sen. Sonny Angara guns for a change in the tax system of the country.

    Just on his first term, Angara has already been lauded from voters of all ages for his courage in talking about topics that used to be taboo, including the much-needed reform in the tax system of the country.

    The senator, who was kind enough to give some of his time to a young writer, commented, “Our Constitution says that our tax system should be progressive—that is the rate it imposes on a person should be based on a person’s ability to pay. That is why our tax system is divided into income brackets: the higher your income, the higher your tax rate.”

    The idea, just like anything else, is wonderful on paper. But the senator points out that the last time the tax code was amended was in 1997. And since then prices have increased, and the cost-of-living has roughly doubled. For example, an annual income of P500,000 today buys far less than what the same income could in 1997.

    “As a result, many in the middle class—like yuppies—are squeezed tight for taxes from their incomes. And while income brackets remain unchanged, people who should really be paying less tax are forced to pay more because they are pushed to higher brackets,” he noted.

    For someone who deals with only basic accounting, taxes never made much sense until now. Now, I’m beginning to understand why my pay increases were not doing much for me.

    The senator continued to point out that the “Philippines has among the highest tax rates in the Asean.” Here, a taxable annual income of above P500,00 is taxed the highest, 32 percent as compared to 10 percent in Thailand, 11 percent in Malaysia, and 20 percent in Vietnam.

    And the young Angara also believes that this is one factor why many Filipinos choose to migrate.

    Asked how this affects the young people, the personable senator replied, “Under the current system, a mid-level manager with gross income of P60,000 is taxed at the highest 32 percent, which is the same rate imposed on the CEO of the company the mid-level manager works for. Such situations underline just how unfair our tax system can be—making it important that we update, reform and transform it.

    “We need tax reforms because the current system imposes too much of a burden on Filipinos and their families, while letting those at the top of the pack continue their trek forward. We need to lower income taxes now because all too easily does the current system dash the hopes and dreams of our young upstarts.”

    For him, the solution lies in Senate Bill 2149 (SB 2149), which he is working day and night to pass. Broadly, SB 2149 can lower the tax burden of each taxpayer. This could not only increase take-home pay, it also allows citizens to have more choices in spending.

    He emphasized, “We want to do this by adjusting tax rates and tax brackets. For instance, under our measure, we want to lower the highest tax imposed of 32 percent to 25 percent by 2017.”

    Fortunately, if passed, young professionals will also benefit. Instead of burdening them with paying such unfair taxes, they will be encouraged and empowered by the government to build their future.

    Indeed, Angara’s passion is undeniable and inspiring. Asked why he doesn’t become jaded despite the many things the government has and hasn’t done, he explained, “The government is actually a very big institution, representing different sectors and employing people of varying walks of life. Whatever it is that we see, hear or read in the news sometimes misrepresents government as a whole.”

    More importantly, a change in perspective is the only thing that one needs to believe in the government again. That instead of the corruption of top officials, Filipinos must recognize rank-and-file government employees who work tirelessly.

    They are “public school teachers who go the ‘extra mile’ every day for their students; policemen and soldiers who are not feared but appreciated by the communities they protect; or managers and administrators who spend long office hours just to provide the best public service their agencies can offer,” he described.

    He added, “The untiring service these people render is what I hope more of the younger generation gets to hear about and understand.

    He ended, “Government is only as good as the trust reposed in it, which is why we in government must do what we can to earn the trust and confidence of the people we serve.”

    With senators like him, young ones like us finally feel that we are getting our money’s worth. He also fuels us to believe that yes, a better tomorrow is possible and not just a passing dream.

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    5 Comments

    1. Christine Tiongco on

      We need tax reforms because the current system imposes too much of a burden on Filipinos and their families, while letting those at the top of the pack continue their trek forward. We need to lower income taxes now because all too easily does the current system dash the hopes and dreams of our young upstarts

    2. Justin Manansala on

      The government is actually a very big institution, representing different sectors and employing people of varying walks of life. Whatever it is that we see, hear or read in the news sometimes misrepresents government as a whole

    3. jose hernani m. parco on

      “We have long had death and taxes as the two standards of inevitability. But there are those who believe that death is the preferable of the two.”!

    4. You write the senator who was kind enough to give some of his time to a young writer, he was kind enough wow give this man a medal. Do you or any of you understand we the people vote for these senators, we put them there yet when they are there they expect & get it with responses like that from you, that they are above us all. Well they arnt above us. They are our representatives & they owe us time. In the uk our politicians have to spend time each month in their constituency where we the people can go there to air our grievances to them face to face. Its normal in my country, but not here no they are put on a pedastall like some god to worship.
      & i havent even read the rest of your column yet, i was just so angry in how you wrote that.
      It all sounds so complicated the way you write about it but i suggest you do a simple bit of research. Just for instance look at the british income tax system, & let me tell you our governments look at & ammend it every year at least once in the budget. Its very simple. The very ;lowest earners pay no tax. The top rate of income tax is 40%. But we also all get a personal allowance which we earn before we start paying tax. Then we can take out private pensions which we get income tax relief on.
      Here in the philippines all these successive governments care about is getting money every which way from everyone, so they can steal it. Make no bones about that, its done because of the endemic corruption in this country in every public office. Its like getting a job here, look how difficult that is made for everyone. You have to get barangay clearance, police clearance, you have to take a medical. My god let me tell you its all about getting money out of you in ever single way. Look at how we in the uk get a job. We see one advertised & just apply for the job, thats it. You will if being considered be called in for an interview & if successful will be offered a job, thats it.

      • You’re right, dusty, for being upset. I too believe that government officials are not above us and we should never feel fortunate that they took time for us. People might find that nitpicking but we all have to realize that these little things probably reveal the mindset that Filipinos have, one that thinks senators and congressmen sit atop pedestals; that we should stand in respect to them when they grace our presence. Yuck.

        Though the statement sounds awful and misused these days, we all should always believe that TAYO TALAGA ANG BOSS NILA. Don’t let anyone tell you otherwise, lest the purpose of government, which is to serve its people, be forgotten altogether.

        In terms of an analogy, we people are the SHAREHOLDERS of a company. We vote who the Board of Directors should be. The Chairman of the Board (President) appoints various people to positions. At the end of the day, the Board, Chairman, CEO, and all of the employees are there to create POSITIVE VALUE for us shareholders. These employees work to create shareholder value; the shareholders don’t work for them.

        And though I advocate tax reform 200%, I think this article was more of a PR piece for the Senator and not one worthy of intelligent discourse. Too bad.