House leadership ‘insensitive’ for pushing TRAIN 2 — Zarate

Published August 8, 2018, 4:52 PM

by iManila Developer

By Ellson Quismorio

Bayan Muna Party-List Rep. Carlos Zarate branded the House leadership as “insensitive” for pushing “TRAIN 2” or the second package of the Duterte administration’s comprehensive tax reform program amid astronomic inflation rates.

Rep. Carlos Isagani Zarate (Bayan Muna Party list Facebook page / MANILA BULLETIN)
Rep. Carlos Isagani Zarate (Bayan Muna Party list Facebook page / MANILA BULLETIN)

“Napaka-insensitive ng liderato ng Kamara na ipinasa itong TRAIN 2 sa panahon na kung saan ay sumipa na naman ang ating inflation sa 5.7 percent (The House leadership is insensitive for passing TRAIN 2 at a time when our inflation has spiked to 5.7 percent),” Zarate told House reporters in a press conference.

The July inflation rate of 5.7 percent is a new five-year high for the Philippines, the previous high being June’s 5.2 percent.

“TRAIN” means refers to the Tax Reform for Acceleration and Inclusion Act, the first package of which took effect as law last January 1.

The law among other things added excise tax on petroleum, the cost of which has a ripple effect on the prices of other goods. The tradeoff was the lowering of income tax rates.

On Tuesday, TRAIN 2 or the Tax Reform for Attracting Better and High-Quality Opportunities (TRABAHO) bill was approved by the House Committee on Ways and Means chaired by Quirino lone district Rep. Dakila Cua.

House Speaker Gloria Macapagal-Arroyo has closely followed the progress of the bill as she even attended a technical working group (TWG) hearing on the matter last Sunday.

TRABAHO aims to lower the current 30 percent corporate income rate down to 22 percent by January 1, 2029. It also seeks to “modernize incentives.”

Revenue neutral?

Zarate says he doesn’t buy proponent’s claim that the bill would be revenue neutral, meaning what you lose is the same as what you gained.

“Sabi nila revenue neutral ito hindi totoo ‘yun dahil binaba mo ang tax rate ng mga korporasyon from 30 to 25. Talagang may mawawala sa kaban ng gobyerno at kukulangin na naman ang koleksyon gobyerno,” said the militant solon.

(They say this is revenue neutral but that’s not true because you’ll be pulling down corporate tax rate from 30 to 25 percent. There will be losses to government coffers and there will be a collection shortage.)

“Saan niya babawiin ito? Babawiin niya ito sa dagdag na buwis na naman na ipapatong, ipapataw sa ating mamamayan sa darating na araw (Where will they recoup this? This will be recouped via additional taxes that will be imposed on our countrymen in the coming days),” Zarate claimed.

There are a total of five packages under the comprehensive tax reform program.

 
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