Why ordinary citizens should support the tax reform program

If we dream bigger, beyond our self-interests and the welfare of our families and our interests, it will be easier to see why a little more sacrifice is necessary.

The first package of the comprehensive tax reform, more popularly known as the Tax Reform for Acceleration and Inclusion (TRAIN), is clearly a mix of popular and difficult measures. For us ordinary citizens, it is easy to unite in pushing for the popular ones, like bringing down the personal income tax and lifting the bank secrecy law. But when we start talking about policies that may directly hit us and entail some tightening of our own spending, our positions become more nuanced and divergent. This is understandable since most of us seek welfare-improvement for a more comfortable and prosperous life.

Working for the tax reform advocacy and facing great opposition especially on fuel taxes and lifting of VAT exemptions for some sectors made us ask ourselves many times, “Why are we doing this? Do we really need to do this?” Sure, there are inherent problems in the system that need to be corrected. Sure, we need more funds to finance public services. But why change tax policy? Why not just improve tax administration and efficiency in spending?

These questions led us to another question, “Where do we want to go?”

The status quo means our economy will continue to grow, albeit not optimally. If we only pass the popular tax measures, assuming that improvement of tax administration can cover for the losses related to it, the working class will be significantly relieved. If we can ensure that underspending will be addressed, all of the administration’s current programs will be implemented. Not bad at all. We will be able to feed and take care of our families while seeing incremental improvements in poverty. Certainly, we will survive.

However, if we dream bigger, beyond our self- interests and the welfare of our families and our interests, it will be easier to see why a little more sacrifice is necessary. The staggered six-peso adjustment in the excise tax on petroleum products and the lifting of VAT exemption for a few sectors will be more acceptable and digestible.

After all, we have long been enduring. Time and again, we have proven that we are a resilient people. A little bit more discomfort will be nothing to us if our goal is to surpass our present mediocre state. Prices of goods, especially fuel prices, have always been moving upward. The only difference, if we choose to raise the taxes now, is that we can expect and demand a portion of that increase to return back to us.

If we desire to pull more of our impoverished countrymen out of poverty; if we dream that more Filipino families need not be separated just so some of their members can find work abroad; if we envision a Philippines that is more inclusive, with its islands and provinces closely linked by roads, bridges, and trains, the more vividly we will see that all we need to sacrifice is loose change.

We are at a critical juncture. We now have the opportunity to not just spend for the present, but also invest for the future. The question is “How much are we willing to invest and how much are we willing to risk?” All investments have risks. The bigger the investment, the bigger the risk.

But the risk is not too big to manage especially since our government is open to dialogues and consultations.

With the Open Government Partnership ( OGP), a lot more doors have been opened to citizens to participate in governance and to exact transparency and accountability in the budget and program implementation processes.

Reforms in the national budget process have paved the way

for the institutionalization of people’s participation across the public finance process. Budget documents that previously were inaccessible, such as the National Expenditure Plan and the Budget of Expenditures and Sources of Financing, are now available on the Department of Budget and Management (DBM) website.

Our participation in the OGP should give us the impetus to also participate in the revenue generation process. The tax reform is comprehensive because we are not just talking about how to raise the needed funds but also where the expected additional resources should go. Our budget advocacy should go hand in hand with tax advocacy, for we want to have a sustainable source of financing for our programs — one that will not burden the future generations with excessive debt.

This is exactly what civil society groups such as the Alternative Budget Initiative, led then, by now Department of Education Secretary, Leonor M. Briones, pushed more than a decade ago — that the menu of alternative programs and projects we propose should also clearly show where the funding will come from.

At the same time the health profession and economic reform groups fought for the Sin Tax Law, in which the bulk of the incremental revenue goes to universal

health care. Now, we are seeing the fruits of the Sin Tax Law with the expansion of PhilHealth members, by providing the premiums for indigents and all senior citizens.

Yet six years ago, our advocacy found it difficult to have the Sin

Tax enacted. Kawawa naman daw kasi ang mahihirap, sigarilyo at alak na nga lang ang kaligayahan

nila, bubuwisan pa. We struggled with the thought of accepting a measure that seemingly passes on more burden to us, especially the poor, even if it meant less cigarette and alcohol consumption, less deaths and diseases associated with these products, and more revenue for health.

This is because taxation is something not easily understood. When we hear taxes, we immediately associate it with burden or anti-poor.

But now, we celebrate and recognize the importance of the Sin Tax Law. We already understand that it is not just a revenue generating measure but more, a policy that improves the health of our people.

The comprehensive tax reform is not different from the Sin Tax Law.

We need to rise above the noise of those who are opposing it in the guise of protecting the poor. Most of them are politicians who, in support of their vested interests, pit classes and sectors against each other. In the case of the Sin Tax Law, they let the poor farmers compete with the sick and the dying. Now, with respect to the TRAIN, they are claiming that the middle class will be liberated at the expense of the poor.

The holistic approach of connecting the sources of financing to the use of funds makes the tax reform a win-win measure to address injustice and inequality. We all have to contribute what we can to building our nation while the government’s role is to redistribute resources to ensure that those who have little will have more. No one needs to be left behind.

We lose when we refuse to participate and push for the passage of a measure that can slowly shape our communities to be healthier and more sustainable and raise the much needed revenue for development programs that address poverty and inequality in education, health, infrastructure and social protection.

No ambitious dream is easy to achieve, but we can do so much when we hope and work together. Though the bill is out of the Committee on Ways and Means of the House of Representatives, and will be deliberated in the plenary session, much has yet to be done to convince our legislators to get it passed in the House at the soonest and in the Senate later. Our participation will ease the swift passage of the long overdue tax reform.

As we make our voices heard, we encourage and challenge all of us to ask the same questions. Where do we want to go and when do we want to get there? What is our dream for our nation? How much are we willing to invest and risk to pursue this dream? And lastly, how much are we willing to sacrifice and contribute to change how things are and significantly build this nation? Sulit ba ang barya-barya at kaunti pang pamamaluktot para sa isang mas masaganang bayan at bukas para sa ating lahat?