SolGen urges High Court to dismiss constitutionality challenge to TRAIN
Government lawyers have asked the Supreme Court (SC) to dismiss two consolidated petitions that challenged the constitutionality of the law on Tax Reform for Acceleration and Inclusion (TRAIN) which was implemented last January 1.
In a comment, the Office of the Solicitor General (OSG) said the TRAIN law under Republic Act No. 10963 “was validly passed by Congress and signed into law by the President.”
The OSG pointed out that “the purpose of the TRAIN law is to eradicate poverty and reduce inequality for the general welfare of the people.”
It told the SC of the “dire repercussions of declaring the TRAIN Law as unconstitutional.”
“The government and the public in general will greatly suffer if the TRAIN Law is declared invalid. The government stands to lose an estimated R146.6 billion in 2018 from the lowering and restructuring of personal income tax. This loss will only be offset by the revenue generating features of the TRAIN Law, which is expected to provide R89.9 billion in incremental revenues for 2018 and R786 billion within the first five years,” it said.
TRAIN is Package One of President Duterte’s Comprehensive Tax Reform Program (CTRP). Package Two of CTRP that was reported to be introduced immediately would focus on the reduction of corporate income with rationalized fiscal incentives
Earlier, Finance Secretary Carlos Dominguez III had said that under TRAIN, more than six million or 86 percent of compensation earners with taxable income of R685 a day or R20,833 a month and below are exempted from paying personal income tax.
First petition The first petition against the constitutionality of TRAIN was filed by three Party-List members of the House of Representatives – Reps. Antonio Tinio of ACT Teachers, Carlos Zarate of Bayan Muna, and Ariel Casilao of Anakpawis. They claimed TRAIN “is anti-poor.”
Named respondents in their petition, aside from President Duterte, were House Speaker Alvarez, Deputy Speaker Raneo Abu, Majority Floor Leader Rodolfo Fariñas, and Deputy Majority Leader Arthur Defensor Jr.
Second petition
The second petition was filed by Laban Konsyumand, er, Inc. (LBI), an advocacy group which alleged that TRAIN imposes a heavy burden on Filipinos from low-income and poor families.
Executive Secretary Salvador Medialdea, Finance Secretary Carlos Dominguez III, Internal Revenue Commissioner Caesar Dulay, Speaker Alvarez, and Senate President Aquilino Pimentel III were named respondents in the LBI petition.
The petitioners in the first case told the SC that TRAIN was enacted by the House of Representatives and signed into law by the President in violation of the 1987 Constitution and Rules of the House.
Lack of quorum They said “there was grave abuse of discretion on the part of the respondent House leaders when they had the TRAIN Bicameral Conference Committee (BCC) Report ratified despite the glaring lack of quorum and several other violations of the Constitution and the House Rules insofar as it implements the Constitution.”
“There being no valid ratification of the BCC Report, there was also grave abuse of discretion on the part of the President as he signed a document which is not a ‘bill passed by Congress’ therefore, has no effect as a bill subject to his approval under Section 27 (1) of Article VI of the 1987 Constitution,” they said.
Solicitor General Jose C. Calida, in the OSG comment that was required by the SC, belied the claim in the petition that the House did not have a quorum when it passed the tax measure.
Calida cited official journals of the House during its deliberations on the TRAIN Law last December 13 when 232 out of a total of 295 members were present.
He pointed out that the journals “are conclusive evidence of what transpired during the session.”
At the same time, he said the SC cannot inquire into or review such existence of quorum in the House for the approval of the tax measure without violating the constitutional doctrine of separation of powers.