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Stopping corruption eliminates need to raise taxes

/ 05:10 AM June 29, 2018

With record inflation inundating low-income earners, I pause at the price of my usual fast-food meals, sag my shoulders, then walk away. Medicine prices went up, too. It was already sky-high even before the TRAIN Law. Now, it’s rocketing to the moon. A supplement I use in lieu of expensive meds to treat my ailments jumped from P10 to P14 per piece.

My basic salary is barely above minimum. If I don’t work overtime, my pay would be close to P10,000 monthly. So from where I toil, it seems the National Economic and Development Authority’s “hypothetical” P10,000 family of five budget is spot-on. Although critics slam this figure as unrealistic or from another planet, I think Neda unwittingly illustrated the prevailing Dutertenomics reality of so many Filipino families languishing on P10,000 or less. After harsh criticisms, Neda elaborated that it takes P42,000 and not P10,000 to survive.

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That budget gap between living and languishing wilts our labor force and necessitates survival outside the law. Tricycle driver Alexander Dimalanta typed on his cell phone two days before he was executed by the police on June 14: “Lord, please help me. I don’t know what else to do. I can’t take seeing my family suffer. I love them very much but I can’t do much more … I don’t wish to do evil.”

There’s a swelling (revolution-size) number of Filipinos oppressed, betrayed and wilting like Alex who may formidably cohere in demanding fairness, not executions, from government.

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President Duterte may think the TRAIN Law is indispensable for government to deliver basic services, but the previous administration delivered the same basic services without it (and China money). Duterteconomists say we need TRAIN to “Build, build, build,” but I recall then Sen. Alan Peter Cayetano saying: “In every peso collected, P2 is not collected, meaning tax evasion and smuggling are bigger corruption issues. P2 trillion to P4 trillion does not get to the government.”

So stopping corruption eliminates the need to raise taxes. Corruption-less collection alone can raise additional trillions for vital infrastructure and more. Otherwise, the only reason for government raising more taxes is to compensate for the people’s trillions they still keep losing to corruption. Subdue corruption before raising taxes, because at this juncture, raising taxes is conceding to corruption.

TRAIN’s most maladroit feature is its abandonment of minimum wage earners who gain nothing, but are now squeezed for more taxes to replace funds the government keeps losing. Now we must raise minimum wage without aggravating inflation. My “small mind” suggests tailoring a legislation (attached to TRAIN) that makes minimum wage hikes more amicable to employers/investors. With the revenue windfall from TRAIN, the government can afford to initially subsidize the hike by giving employers a corresponding tax credit or exemption for every minimum wage hike.

I hope the government can tinker

with the idea and not dismiss me as a “crybaby” with “a small mind that has not studied the issue.” Well I don’t need to, I live in it. And I believe that, to any sincere leader of a nation, stopping corruption before raising taxes is a no-brainer. ’Wag na tayo magbolahan. TRAIN in its present form is just another tool for heaping the cost of corruption and incompetence on the Filipino people.

ERNIE LAPUZ, nitelites@rocketmail.com

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TAGS: Graft and Corruption, Tax, TRAIN Law
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