By Genalyn Kabiling, Manila Bulletin

 

Kuala Lumpur – President Aquino has called on lawmakers to prioritize the passage of the proposed 2016 national budget and Bangsamoro Basic Law (BBL) this year before getting preoccupied with the campaign season.

 

In relation to the campaign season, Aquino has called the proposed reduction of income taxes as a “pogi bill” or a measure to earn brownie points from the voters. He said the proposal is “fiscally irresponsible” since it would reduce government revenues and bloat the budget deficit.

FOCUS ON LEGISLATIVE WORK

 

The President said it would be “ideal” if government officials, especially senators vying for elective posts, would focus on their legislative work especially since the campaign period for the 2016 polls has not even started.

“There is a standing joke in the Philippines: When does campaign period start in the Philippines? The day after the elections,” Aquino said in a media interview Sunday night before he flew back to Manila.

 

“Probably we can focus on our work since there is no formal campaign period yet for everybody. To the senators, maybe you would want to finish the BBL and approve the budget since you’ve completed the process,” he added.

P3.002-TRILLION BUDGET

 

So far, the P3.002-trillion budget bill has been passed by the House of Representatives after the President certified it as urgent.  The measure will still undergo the scrutiny of the Senate. The 2016 budget proposal is 15.2 percent higher from this year’s P2.606 trillion budget. It comprises 19.5 percent of the country’s Gross Domestic Product (GDP).

The proposed BBL, on the other hand, is still being deliberated in both houses of Congress. Senator Ferdinand “Bongbong” Marcos Jr. earlier claimed that the Palace-endorsed BBL has no chance of getting passed in the Senate due to some alleged unconstitutional provisions. The senator has proposed a substitute bill for the BBL called the Basic Law for the Bangsamoro Autonomous Region (BLBAR).

President Aquino however said it was more important to hold congressional debates on two priority measures so these could be approved “before the end of the year.”

“There is an expectation that they will be able to pass the budget on time, which means before the end of the year. That means that the quorum is there and present,” Aquino said.

 

THE BBL

On the BBL, Aquino said the nation has an opportunity to change the situation and the reality in Mindanao.

 

“If we don’t do it in a timely manner, we leave it pending until the next administration comes, which means after June 30,” he said.

“Are we sure that we will always have this combination of factors that has gotten us to the point that we really have a law that we are debating that can substantially change the situation? Ako I don’t want to risk it,” he added.

 

‘POGI BILL’

 

Meanwhile, the President has remained reluctant to endorse the bill lowering the 30 percent tax on personal and corporate earnings just to earn popular votes.

 

“I am a politician, too. It is easy to earn brownie points this elections and reduce the taxes. In fact, I have only eight months left in office, I will not be responsible in case there is a problem,” Aquino said.

“But how about my conscience? The various headaches, problems still without solutions, those we are still trying to resolve to this day. I promised not to pass these problems to the next administration,” he added.

 

Aquino did not totally shut his door on the tax proposal, insisting it must be thoroughly studied to strike a “balance” between giving relief to workers and keeping government finances stable.

TO OFFSET REVENUE LOSS

 

The President noted that some lawmakers have proposed measures, including bills raising taxes on carbonated drinks as well as lifting the bank secrecy law for tax purposes, to offset the revenue losses if lower income tax rates take effect. But the lawmakers themselves admitted there is no more time to pass such measures, Aquino said.

I told Congress, “there is pressure on you. That’s really a handsome bill but there should be a balance. I don’t want to promise our people I would reduce their taxes only for my successor to seek higher taxes later. I might end up getting cursed by people,” Aquino said. He insisted that he has no plan to break his campaign promise not to introduce new or higher taxes except for the sin taxes.

 

LOWER BUDGET FOR SOCIAL SERVICES

Besides, Aquino said revenue losses from the proposed income tax cuts would lead to lower budget for vital social services such as the conditional cash transfer program that benefits millions of poor households.

 

And if credit ratings threaten to downgrade the country’s rating due to unstable finances, Aquino warned that the government might be forced to borrow abroad or even raise taxes. Eventually, the government would earn the ire of taxpayers.

RAISE TAKE-HOME PAY

 

Backed by the public, several lawmakers are trying to convince President Aquino to approve the bill that seeks to raise the take-home pay of salaried workers. Some Congress leaders even met the President to agree to the measure that would adjust the income tax rates to inflation.

The President, however, was still lukewarm to the proposal due to its impact on the government’s finances during his meeting with the lawmakers.

 

So far, Aquino said the government has given P96.8 billion in tax relief over the past several years, citing the law on higher tax exemption bonus ceiling on workers’ bonuses, among other measures.

IMPROVE COLLECTION

 

For now, Aquino said the government is focused on improving revenue collection, particularly from the professional sector. Of the two million taxpayers in the professional sector, Aquino said only 400,000 persons are paying taxes. Of this number, only a small fraction is paying the correct taxes.