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2.08.2007

Tax Amnesty: Gimme a break!!!

As a way of cleaning its books and as an attempt to get a one time windfall, the Philippine government is implementing a Tax Amnesty measure. In the said program, the government aims to make PhP11~32 Billion.

According to Businessworld:
" to redeem themselves and begin dealing with tax collectors with a clean slate as the Senate yesterday approved a bill granting a "general, one-time" tax amnesty for delinquent taxpayers who wish to settle their dues with the government.

Time is running out however, for the next stage in the lawmaking process - deliberations with the House of Representatives to craft a final bill - with a senior House leader indicating the tax amnesty could still be months away.

House Bill 2933, sent to the Senate in October 2006, was unanimously approved but after several amendments including increasing the tax amnesty rate to 5% from 3%. The rate will be charged on a taxpayer’s net worth as reflected in the statement of assets, liabilities, and net worth required of those who want to get a tax amnesty."

Some sectors may find the attempt worthy of commendation. Afterall, if successfully implemented, it will result to added revenue for the government and even renew the authorities' contact with companies and individuals who have been delinquent in the past. Future collection performance may actually improve because of the new measure.

However, is the new law fair? Does it conform with the government's job of administering social justice? Most Filipinos are still hurting from the implementation of the E-VAT (Expanded Value added Tax). Every time they pay for their meals and purchase goods, they see the 12% evat being levied upon them. On top of that, employees (most Filipinos) are deducted their income taxes every payday.

On the other hand, the delinquents, the root causes of the country's very low tax collection, the same people/entities who are the grounds for the increases in the Evat (from 10~12%) and the creation of more tax measures, are being offered amnesty on a silver platter.

Tsk tsk...

Argh!!! Can't the government just reduce the income taxes, eliminate most other taxes (they can't impose, anyway) and simply increase it's collection efficiency? How will they do it? Outsource.

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