Tax cuts, improved lives sought in PNoy’s last Sona

By Luis Leoncio

President Aquino is being asked to devote his last State of the Nation Address (Sona)—his legacy speech, according to many—to unfulfilled promises and the improvement of his countrymen’s daily lives.

Among those urging the President is his ally, Sen. Juan Edgardo Angara, who said the President should make the reduction of personal income-tax rates as his goodbye gift by mentioning it in his Sona.

“One of the most awaited words and one that will be most applauded is the President saying he will back bills lowering individual income taxes,” Angara said.

Angara, chairman of the Senate Committee on Ways and Means, authored Senate Bill 2149 that aims to adjust and compress income-tax brackets and reduce the maximum tax rate, especially for low- and middle-income earners from 32 to 25 percent by 2017.

He is hoping that among the bills the President traditionally mentions in the Sona for priority approval are those that will revamp tax brackets.

Angara said the Philippines has the second-highest individual income-tax rate in Southeast Asia, at 32 percent, next to Thailand’s and Vietnam’s 35 percent, and  the highest value-added tax in the region at 12 percent.

He also noted that the country’s current individual income-tax bracket has remained unchanged since 1997 although the consumer price index has already almost doubled.

“We need to think ahead and be competitive in the region but more important, we must give the Filipino people a break,” Angara said.

Meanwhile, the think tank Ibon said the growing number of poor Filipinos debunks the Aquino administration’s claims that its successful poverty-alleviation strategy would be one of its achievements that must be continued by the succeeding administration.

The group delivered its assessment of the Aquino administration’s five years in office in its Birdtalk forum recently at the University of the Philippines School of Economics.

Using an altered methodology based on very low standards resulting in only P52 as the official poverty line, government statistics counted 23.8 million poor Filipinos in 2014. The Annual Poverty Indicators Survey (Apis) in the first semester of 2014 counted 25.8  percent of the population as poor, higher than the 24.6-percent poverty level in the same period the year before.

IBON’s May 2015 nationwide survey meanwhile showed a total of 79.6-percent respondents saying that livelihood did not improve in the recent months.

Relatedly, 72.3 percent of 1,496 respondents said that poverty did not go down in the recent months. Majority of the respondents also rated themselves poor and expressed difficulty in spending for basic needs and social services.

These figures are more consistent with Ibon estimates using official data that some 55 million to 66 million Filipinos live on only P100 to P125 per day. This is way below the P217 amount needed by a person to live decently.

Ibon’s May 2015 survey also showed a bigger share of respondents (67.2 percent) who said they see their situation today as poor compared to those who said the same in January (64.6 percent).

The Aquino administration’s centerpiece poverty alleviation program was not the answer to deep and widespread poverty in the country despite the government budget ballooning by 547 percent and having reached an accumulated P178 million in expenses as of 2014.

Ibon, citing its figures, said the number of unemployed Filipinos continued to swell since the start of Mr. Aquino’s term, making the worsening job crisis a distinct feature of the administration.

The group added the number of unemployed Filipinos has likely risen by at least 100,000, the number of underemployed Filipinos by at least a million, and the number of merely part-time workers by at least 1.5 million.