unions to increase their bargaining power to adjust labor’s share of the income gains. Institutional support from the state to usher in a more labor-friendly environment did not come about, hence, the steady weakening of labor’s bargaining power and the steady rise of capital’s share of the yearly income and productivity gains.
Mr. Aquino’s six years in power elevated several members of the Philippine rich to the status of “those- who- can- buy- a- small country-rich.” That list will surely increase under Mr. Duterte.
The best is yet to come for the super-rich
The state of Cloud 9 in the world of oligarchs and plutocrats is further pushed to a new level, buoyed by the commitment of the DU30 administration to anchor Phase II of the supposed tax reform package on the reduction of the corporate tax rate. From 30 percent, the plan is to reduce it to 25 percent, or lower.
Nothing lifts the optimism of the rich more than the promise of a corporate tax cut and they feel nothing will stop the DU30 administration from pursuing this course of action.
A corporate world awash with environment to push for a corporate tax cut. But the DU30 administration said it will be done. Mostly likely, it will be done.
Corporations, with their armies of lawyers and accountants, have this ability to routinely pay below the 30 percent tax rate. Some say the effective corporate tax is even below the planned 25 percent. 25 percent, the effective rate that the corporations will pay, will go down substantially.
Even the promise that the incentive scheme granted by the Board of Investments and other government agencies will be rationalized to offset the revenue drops from the corporate tax cut will not come about. The main incentive to the rich in any market economy comes in the form of a corporate tax cut and that is what they truly covet.
During the term of Mr. Aquino, I had a piece that said the government “was for the rich, by the rich and of the rich.”
Nothing much has changed under Mr. Duterte. I repeat. If the super-rich had bliss under Mr. Aquino, they have heaven under Mr. Duterte.