Stop smuggling instead of new taxes

THE government of PNoy, especially its financial advisers, should have circumspectly assessed before obliging their allies at the lower chamber to push its new brainchild through House Bill 5727 which seeks to raise new taxes by introducing what it calls a unitary tax system for tobacco and alcohol products.

We can’t blame the lawmakers, some of whom used to be closed with PNoy’s predecessor that had decided to associate themselves with the administration for the good of the people, so to speak, if they start to cry foul after taking into consideration the ill-effects once it gets the nod from Congress.

One can’t just object to the wisdom of the proponents to push for the measure which they claim would tremendously boost the revenues as they estimate to rake in some P60 billion once the so-called “sin tax” law is amended.

But 1st District Valenzuela City Rep. Rex Gatchalian, whose Nationalist People’s Coalition party has allied with the President’s Liberal Party, would not buy it. He believes it’s just a “shorter and more convenient route” to increase government finances at the expense of these poor tobacco farmers and ordinary distillery workers.

Many may agree with Cong. Gatchalian, the younger brother of Valenzuela Mayor Sherwin Gatchalian for there are existing measures that if implemented to the letter would result to more funds for the government coffers.

The Valenzuela legislator is just right when he dares the government to apply pressure on the Bureau of Customs (BoC), among others, in a determined bid to raise the needed revenues.

Whether directly or indirectly, massive economic dislocation will surely take its course and no less than millions of tobacco farmers, distillery and allied industry workers and their families will be affected once prices of tobacco and liquor jack up as a result of huge increases in taxes.

Of course, if taxes will be increased to the extent that the companies would eventually not be able to sustain it, comes next would be the impending collapse of the industries and who are the losers in the end, no other than these hapless farmers and workers?

Rep. Gatchalian says: “The problem with finance people is that they always take the shorter and more convenient route to raise revenues. Why turn up the heat on tobacco farmers and ordinary workers when they can instead do this on the Customs which has been playing dead when it comes to revenue collection.”
Describing the BOC as a perennial loser in the race for revenue collection efficiency, he says the finance department should work hard to ensure collection efficiency among revenue generating agencies of the government instead of increasing taxes.
Smuggling activities that must be stopped by the government will even persist with the passage of HB 5727 since those in the vices can no longer afford to buy and that’s the time these crooked traders and smugglers will come in.
And that’ll surely hurt the economy, too bad.

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