Defense of the Republic of the Philippines

General Discussion => Defense Legislation => Topic started by: adroth on December 20, 2017, 09:58:37 AM

Title: Tax Reform for Acceleration and Inclusion (TRAIN)
Post by: adroth on December 20, 2017, 09:58:37 AM
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See also: Solons ask SC: Stop the TRAIN (


President Rodrigo Roa Duterte leads the ceremonial signing of the 2018 General Appropriations Act (GAA) amounting to PhP 3.767 trillion and the Tax Reform for Acceleration and Inclusion (TRAIN) at the Rizal Hall of Malacañan Palace on December 19, 2017.

The President is joined in the event by his Cabinet Secretaries, members of the Senate and House of Representatives, officials and staff of the Presidential Legislative Liaison Office (PLLO), personnel from the Department of Budget and Management (DBM) and the Department of Finance (DOF), and other invited guests.
Title: Re: Tax Reform for Acceleration and Inclusion (TRAIN)
Post by: adroth on December 20, 2017, 10:07:18 AM




Title: Re: Tax Reform for Acceleration and Inclusion (TRAIN)
Post by: adroth on January 12, 2018, 03:29:56 PM

Posted on September 24, 2017 by admin
The Department of Finance (DOF) has maintained that the proposed Tax Reform for Acceleration and Inclusion Act (TRAIN) will benefit 99 percent of Filipino households because of its proposed income tax cuts for salaried workers plus the unconditional cash transfers for the country’s poorest families.

Also, fears over the supposedly adverse impact of the proposed higher taxes on petroleum products are “illusory” because its inflationary effect will actually be “minimal and temporary” in nature, according to Finance Undersecretary Karl Kendrick Chua.

“Rightly relieving the salaried working class of the inequitable tax burden does not imply that the reform will leave the poor and vulnerable dry,” said Chua in response to issues raised by some quarters against the tax reform bill.

Chua said the targeted transfer program, which will benefit the bottom 50 percent of the population, is designed to provide immediate benefit to poor families to help them adjust to the fairer, simpler and more equitable tax system under TRAIN.

“Prosperity for the poor, however, will not be achieved through subsidies, exemptions, and freebies but from better health services, improved roads, faster and safer modes of transportation, improved access to quality education, among other social services that will make them more productive and improve their opportunities to get better jobs and accelerate their graduation out of poverty,” said Chua.

The additional revenues generated by the TRAIN, Chua said, would help support these pro-poor programs.

Chua said that contrary to misinformed claims by some quarters, the impact on prices of expanding the value-added tax (VAT) base and adjusting fuel excise tax are ” only moderate and temporary. ”

As an example, he recalled that when crude oil increased by as much as 76 percent between January 2016 and January 2017, overall inflation was only at 2.7 percent.

The inflation rate increase was also moderate and temporary when the VAT was raised to 12 percent in 2005, and during the oil price shocks in 2011.

“Despite concerns by the industry at that time that higher taxes or higher prices could lead to lower economic growth and skyrocketing inflation, history shows us that we have weathered the shocks quite well, even when the economy was not in the best of shape,” Chua said.

In the case of the TRAIN, Chua said DOF estimates show that inflation will increase by 0.9 percentage points in the first year, which will taper off in the following years.

The Bangko Sentral ng Pilipinas (BSP) and the National Economic and Development Authority (NEDA) have even lower inflation-spike estimates of 0.5 and 0.4 percentage points, respectively, he said .

“The DOF will be coordinating with different agencies, including the BSP and the Trade Department, to ensure that prices are in check and profiteering is mitigated. The BSP is in a strong position to curb excessive movements in inflation,” Chua said.

As for claims that the TRAIN will make life easier for the rich at the expense of the poor, Chua said ” the opposite is true “as the bill will benefit salaried workers in the form of lower taxes, which will increase their take home pay, and shift the burden to the rich who will be taxed at a higher rate of 35 percent from the current 32 percent.

“The Philippines cannot afford to just muddle through if it were to catch up with its more successful neighbors and realize its collective goal of eradicating extreme poverty,” Chua said. “At the core of the tax reform is the vision to eradicate poverty, reduce inequality, and bridge the Philippines towards the future.”

On proposals to merely improve tax collection, Chua noted that even if the Bureaus of Internal Revenue (BIR) and of Customs (BOC) were to become 100 percent efficient, they would still be unable to achieve their collection goals because the current tax system itself is riddled with loopholes and inherent deficiencies that bar the BIR and BOC from hitting, much less surpassing, their annual revenue targets.

As for the proposal to include a tax on sugar-sweetened beverages under TRAIN, Chua pointed out that this is a health measure, designed to reduce consumption of easily accessible yet unhealthy drinks that increase the risks of obesity and diabetes among Filipinos.

“The monthly maintenance for diabetes, for example, is around P5,000 to P60,000 per year. This is not affordable for 80 percent of the population,” he said.

Moreover, “poor health traps households into poverty, reducing productivity and burdening families with medical expenses and giving up productive time to care for the sick,” Chua said.
Title: Re: Tax Reform for Acceleration and Inclusion (TRAIN)
Post by: adroth on January 12, 2018, 03:31:44 PM
Palace assures TRAIN proceeds to benefit everyone 
 January 5, 2018

MANILA, Jan. 5 -- Presidential Spokesperson Harry Roque, Jr. on Wednesday, January 3, reminded the public of the implementation of the tax reform law starting this year, stressing that its proceeds will benefit everyone.

Republic Act No. 10963, or the Tax Reform for Acceleration and Inclusion (TRAIN) Act, will reduce the burden of Filipinos from paying income taxes.

"Of course you know that January 1 is the implementation of the TRAIN reform. Let me stress though that the implementation of TRAIN relates to the fact that those having an annual taxable income of P250,000 and below or at least P21,000 a month are now exempted from personal income tax. Thirteenth-month pay and other bonuses amounting to P90,000 are likewise tax-exempt," Roque said in a press briefing in Malacañang.

On the concern that the TRAIN’s revenue-enhancing provisions would lead to higher prices, Roque clarified that the TRAIN proceeds will go back to the people in terms of infrastructure, which is expected to stimulate the economy.

He also assured the public that the Department of Trade and Industry (DTI) is doing its mandate to monitor price movements in the market.

"Well, someone has to pay for Build, Build, Build that will produce positive effects for everyone and of course, it is done through taxes," he underscored, referring to the massive infrastructure program of the Duterte administration.

"Taxation is one of the three inherent powers of the state and for as long as it is approved by the people’s representatives, which is Congress, is it acceptable in a democratic state," he explained.

Likewise, Roque said that a portion of TRAIN revenues will be used to help fund the government's conditional cash transfer (CCT) program.

"We have also begun implementing the P200 per month ... as a measure of mitigating the effects of TRAIN, at least to the poorest of the poor in our communities," he said.

A technical working group is now being formed in preparation for the timely release of the cash transfer. The cash grant will be distributed between January to July 2018.