De Lima airs concern over impact of tax reform package to poor families

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Senator Leila M. de Lima has called for a thorough review of the possible adverse impact of the administration-sponsored Tax Reform for Acceleration and Inclusion (TRAIN) program to millions of poor families.

De Lima filed Senate Resolution (SR) No. 407 urging the appropriate Senate committee to scrutinize the potential effects of the TRAIN which has been passed on third and final reading at the House of Representatives.

“There is an urgent need to investigate such impact, in aid of legislation, especially in light of the TRAIN bill in the Lower House,” she said in her resolution.

The TRAIN, a priority measure of the Duterte administration, seeks to lower personal income taxes and estate taxes but will impose higher excise taxes on fuel, sugar sweetened beverages, new cars to recover losses the government will incur by lowering personal and estate taxes.

Critics of the tax reform program also noted that the increase in excise taxes will drive prices of basic commodities up, apprehensive that poor families will even become poorer with the increased cost of goods.

Once the revenue measure reaches the Senate, De Lima underscored the need to study the possible long-term effects of the tax reform program which she said might bring more harm than good to the country’s economy.

“The government must be ready to withstand the economic shocks of the proposal, while taking into consideration other economic factors like rising unemployment,” she said in her resolution.

Under SR No. 407, De Lima noted that, at its face value, the tax reform package merely reshuffles the burden of taxes, as it only shifts the costs to other fast-moving taxable sources, which will strongly affect the poor, such as the minimum wage earners, and the unemployed, who have no capacity to pay.

“Congress is duty-bound to ensure that tax proposal abide by the Constitutional standard of uniform and equitable tax system, and that they have long-term positive effects for all stakeholders, including taxpayers, those who pay direct and indirect taxes alike, and the Government,” she said.

According to the Philippine Statistics Authority, 6.6 percent or around 4.6 million of the workforce population are unemployed and stand to be the most affected by the price increase of commodities caused by tax reform package of the Duterte administration.

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