P-Noy firm: No income tax cut

MANILA, Philippines - President Aquino reiterated yesterday his stand against the lowering of income taxes for fixed-income earners in the country – the highest in Southeast Asia – even if administration presidential candidate Manuel Roxas II has backpedaled on the issue.

Aquino remained cool to proposals by his allies in the Senate and House of Representatives to lower the 30 percent tax on personal and corporate earnings, especially if the lost revenue will not be recovered from other sources.

“By reviewing the concept of income tax, it cannot be taken as a singular activity. There is a reduction in revenue so there has to be compensation elsewhere,” Aquino said during the Foreign Correspondents Association of the Philippines’ annual presidential forum.

He recalled that when he ran for president in 2010, he had promised that his administration would not raise taxes except on “sin” products, and would instead work hard for efficient tax collection.

Marikina Rep. Miro Quimbo, chairman of the House ways and means committee, was earlier quoted as saying that the lower income tax measure will most likely be approved in the current 16th Congress following the directives of Aquino for the finance department to study the proposal.

But Aquino is still unconvinced, despite his previous meeting with Quimbo and his counterpart, Sen. Sonny Angara, who heads the Senate ways and means committee and who asked the President to take a second look at the measure.

Aquino pointed out that if the bill is passed, it will have “unintended consequences that we’d rather not undergo.”

“We’re still operating under a budget deficit,” the President said.

He warned that reducing income taxes might only force the government to raise other taxes.

Last month, Aquino also told reporters in an interview in Iloilo City that there is no government surplus to give public and private workers such tax relief.

“Perhaps if we had been enjoying a surplus for the past years, then I think we can sit down and talk about it,” he said.

Fickle-minded

Meanwhile, the United Nationalist Alliance (UNA) yesterday hit Roxas for flip-flopping on the issue of reducing income taxes.

UNA spokesman Mon Ilagan described Roxas’ position on the proposal to reduce income tax rates as “sala sa init, sala sa lamig,” a Filipino saying which refers to a person who easily changes his mind.

“Before, he didn’t want to lower income taxes. Now, he’s in favor of it,” Ilagan said in a statement.

According to Ilagan, Roxas previously said that it is easy to grandstand and look good by proposing to trim down taxes.

“Now he’s saying he was misquoted on his stand on this issue. Can he make up his mind?” Ilagan asked.

“Many people have been supporting the reduction on income taxes and we want a leader who can be man enough and have the courage to stand by his position,” he added.

At least 18 groups belonging to the business, trade, professional and labor sectors, have supported the call for lower income taxes, Ilagan said. – With Helen Flores