Telecommunications companies should shoulder tax on text - Nograles

MANILA, Philippines - Speaker Prospero Nograles yesterday said that telecommunications companies should shoulder Congress’ proposed 10-centavo additional fee for texting and not pass the burden to consumers.

“Being the so-called texting capital of the world, our people should be able to benefit from the billions of profits of our telcos,” he asserted, insisting that the current P1 per text rate “should be cheaper by 75 centavos.”

“In the first place, text services should not even be charged, being a value added service. And since our telcos are raking in so much profit from this service, we might as well ask them to give back to our people,” Nograles pointed out.

“Even if we charge a 10-centavo fee on every text sent, the telcos are still overcharging us by 65 cents per text,” the Speaker stressed. The estimated threshold amount of text is about 25 centavos but telcos charge an average of P1 per text on its non-promo rates.

Nograles has been calling on the country’s telecom giants – Smart, Globe and Sun Cellular – to practice social responsibility by setting aside some P200 million from profits from the approximately two billion text messages sent by Filipinos per day.

He said the 10-centavo fee for each text message can go a long way in funding the government’s health and educational programs, but stressed the amount should be taken from the regular cost being charged by mobile phone service providers.

To avoid questions on the disbursement of fees generated from text messages, Nograles suggested that the fund be “administered by a board composed of owners and telecom players.”

This could even include the Secretary of Health and Secretary of Education to manage the “exclusive trust fund” and make sure that it is spent only on the upgrading of public schools, hospitals and health centers nationwide.

“In the Philippines, texting has become the mass-based linkage – the cheapest and most reliable means of communication,” Nograles said.

On Wednesday, Rep. Danilo Suarez, chairman of the House committee on oversight, made the proposal as another measure to help the government cushion the potential impact of a global economic meltdown.

Suarez, however, acknowledged that there is no guarantee they could impose a “no pass-on provision,” which means the consumers would likely bear the brunt of the additional cost of text messaging.

But some lawmakers, like House deputy minority leader and Bayan Muna Rep. Satur Ocampo, opposed this, expressing fears that the burden would again end up on the shoulders of subscribers.

“Congress must be sensitive to the plight of the people. What it must look into is the telcos’ mislabeling of text messaging as a value-added service that has given rise to the illegal charging and the illegal slapping of VAT on text messaging,” the militant lawmaker said.

Senators have also expressed opposition to the proposal, saying the government should find other ways to increase its revenues at this time of economic difficulties.

Sen. Manny Villar urged his colleagues to study the possibility of increasing the tax on sin products rather than push for the 10-centavo text messaging tax.

“The fact that we are experiencing the effects of the financial crisis like the rest of the world should be one of the considerations before we propose legislation that will prove to be an additional burden to the poor Filipino,” he said.

However, Malacañang declared Thursday that it is leaving it up to Congress to work on the proposed bill to add a 10-centavo fee on text messages.

Press Secretary Cerge Remonde said the proposal must be studied carefully because of its impact on consumers, arguing that while the measure would provide substantial revenues for the government, it could also burden consumers. – With Ding Cervantes, Aurea Calica