Palace’s ‘moronic logic’ on pay, income tax cuts

Coming on the heels of President Aquino’s opposition to the bill proposing income tax cuts, the news report “Palace to file bill increasing pay scale of gov’t personnel” (Inquirer.net, 11/9/15), also mirrors—I hate to say this—the moronic logic of the man we have elected president.

Mr. Aquino says the income tax cuts will lower government revenues, expand our tax collection deficit and affect the country’s credit rating. That is based on Internal Revenue Commissioner Kim Henares’ estimate of the foregone revenue—at least P29 billion a year. On the other hand, Budget Secretary Florencio Abad says the bill increasing the pay scale of government employees seeks a four-year P226-billion compensation hike (or P56.5 billion per year) for the government’s 1.53 million civilian, military and other uniformed personnel.

Need I point out the bill that entails the larger revenue loss?

Meanwhile, some government officials should perhaps either rehearse their arithmetic or be a bit more honest and real. Sen. Teofisto Guingona Jr. says the bill improving the government employees’ compensation package seeks to bridge the gap between the pay of employees in the public sector with their counterparts in the private sector. What gap is he talking about? Isn’t he widening, not bridging, the gap?

For one thing, the existing minimum wage in Metro Manila is P466 per day. And it is safe to say that the national average could be far below P400. This compares with the P9,000 per month that the lowest paid government employee (pay grade 1) is now receiving. Since the public sector employees are on a five-day work week, their equivalent daily minimum rate is P415.34. (Well, in case Guingona was absent when this computation was taught in his grade school years, the P415.34 is arrived at by multiplying P9,000 by 12 months and dividing the product by 260, in turn the result of multiplying five days per week by 52 weeks per year).

For another matter, let’s compare the usual or average monthly pay that each of two duly licensed professionals who have just passed the board may expect per month on assuming his or her first job. A public school teacher is guaranteed P18,000; a certified public accountant will be lucky to start at P16,000 in a medium-sized private business establishment.

Before anybody gets me wrong, I am not against the bill improving the compensation package of government employees. That is certainly good news! But let not the good news be saddened by the government’s bias against private sector employees, especially the unorganized—large-enough and continuously growing—sector of Philippine society. Their only chance to improve the purchasing power of their take-home pay lies not as much in a wage hike (more often grudgingly granted by their greedy employers) as in the miniscule tax reduction offered by the bill updating the country’s truly obsolete income tax system.

Please, Mr. President, do not deny that chance from them!

—RUDY L. CORONEL, rudycoronel2004@gmail.com