P-Noy renews vow against imposing new taxes

CEBU CITY ,Philippines  – President Aquino reiterated yesterday his administration’s policy against imposing new taxes, even if four foreign credit rating agencies have already given a positive outlook on the improving economy.

He said efficient tax collection remains his top priority as this had been his promise to the people when he campaigned for the presidency in May 2010. This means plugging the leaks and strictly enforcing laws on smuggling to improve tax collection and generate revenues.

“Pangako ko sa taumbayan, bago tayo mag-iimpose ng bagong taxes, kailangan naman muna nating kolektahin iyung nandiyan na mga buwis. The cases that BIR and Customs filed are for smugglers, for the purpose of improving our revenue generating capabilities,” he said.

 “I am not sure if the imposition of new taxes is the right route,” Aquino stressed. “The widened tax-base, goes hand-in-hand with improving the tax collection efficiency,” he added.

The President said he would not agree with a flat rate tax for a certain sector of society because that is tantamount to admitting that government is helpless in its efforts to collect tax, and would rather yield to setting up a common tax for all instead.

This is why he urged justices of the Court of Tax Appeals to resolve at the soonest possible time the tax cases against companies caught violating tax laws by avoiding payment of such, thereby depriving government of its much-needed revenues.

 Insisting that raising new taxes would be the last resort of this administration, a Palace official had hinted earlier that President Aquino can “consider” doing so in 2012, or before the middle of his term in 2013.

“If calculations are correct, if there is a need to raise taxes, we can always consider that next year,” Secretary Ricky Carandang of the Presidential Communications on Strategic Planning and Development said.

He clarified however, that President Aquino still maintains the position that the government needs to plug the loopholes in the tax collection efforts first, before any tax increase can be considered. 

The Philippine Institute of Development Studies reported that the Aquino government may not have enough funds for it to sustain and meet the goals it had set for the achievement of Millennium Development goals.

Instead of imposing new taxes, the administration is contemplating on privatizing losing companies instead, and is trying to find new ways on how to improve the economy.

In an effort to further pump prime the economy, the government is contemplating on privatizing the Manila-based headquarters of the Philippine National Police and the Armed Forces of the Philippines, Finance Secretary Cesar Purisima said last January.

The Department of Finance chief told Palace reporters that privatizing Camps Crame and Aguinaldo in Quezon City is one of the options they are thinking.

“Do we need these camps in the city? I’ve had discussions with Defense Secretary Voltaire Gazmin, and they’re all very supportive of the fact that Aguinaldo and Crame should probably not be there,” he said.

Purisima said these are among the various assets the government has to help its Public-Private Partnership Program, where they urge local and foreign investors to help in providing infrastructure to the Filipino people.

“They should probably be re-developed in order to build a better and bigger site of a consolidated military facility, and modernize the armed forces and have funds. All these discussions are going on right now and are in preliminary stages,” he revealed.

This is part of the “comprehensive plan” the Aquino government is planning in its PPP projects, by way of “tapping the resources of the private sector so we use their expertise, their technology, their money, to build our infrastructure.”

“And at the same time continue to re-deploy the assets of the government that are idle or are not properly utilized. We are looking at all this,” Purisima stressed, noting idle lands of the penal colony, the Department of Health and many others.

“There are so many assets of the government, the DOH has 40 hectares in the middle of Cebu. The government has a lot of assets. That’s something I realized, we’ve been talking to each of the departments,” he said.

Others include the 343-hectare property of the New Bilibid Prison in Muntinlupa City, the 26,000-hectare Iwahig Penal Colony and the Penal Colony in Davao.

BIR to meet 2012 goal sans new taxes

Meanwhile, the Bureau of Internal Revenue (BI) expressed confidence it can meet its trillion peso collection goal next year even without new taxes.

BIR Commissioner Kim Henares said the government did not assume any new tax measure when it set the agency’s P1.006 trillion revenue target for 2012.

“If there are new taxes, definitely, our goal … would be more than that, say P1.1 trillion or higher.”

“The P1.006 trillion target is purely reliant on our efficiency in tax collection, and economic growth,” Henares added.

President Aquino had vowed not to impose new taxes, nothing his administration’s focus was to run after tax evaders and smugglers to plug the holes in the system.

Henares said they will not appeal for a much smaller goal next year. “The goal is set to be reached.”

The BIR’s 2012 target is 13 percent higher than its P940 billion goal for 2011.

For the first five months this year, the BIR collected P391.09 billion, nearly 14 percent higher than its collections of P344.10 billion in the same period last year.

Budget Secretary Florencio Abad earlier said the Aquino administration would boost its 2012 spending by eight to 12 percent, while keeping the budget deficit ceiling at 2.6 percent of economic output.