Drilon: Congress has final say on tax reform package
Congress has the final say on what would be the final version of the government’s tax reform package which is expected to relieve 6.8 million workers of income taxes, Senate Minority Franklin Drilon said on Tuesday.
Drilon made the remark on ANC’s Headstart when asked why the Senate appeared to be “jumping the gun” on the Department of Finance (DOF) by including “passive” income taxes in its proposed tax reform package.
“Isn’t it the DOF the one jumping the gun on the Senate and the Congress? Why am I saying that? Because taxation is basically a function of Congress and not the DOF,” he said.
“That’s why you have elected representatives who are authorized to impose taxes as representatives of the people. We have the mandate to increase taxes or to lower taxes. That’s not a function of the DOF. Insofar as taxation is concerned, they can only suggest to us. We are the ones who will determine what should be in package one, what should be in package five,” the minority leader added.
Asked then if the DOF role was only “recommendatory,” Drilon said answered in the affirmative.
“That’s correct. If we don’t agree with it, it should be our view that will prevail,” he said.
In pushing to increase taxes on fuel, the DOF argued that in the past years, if inflation goes up by a minimal amount, consumers will not feel the change in the prices of commodities.
But Drilon stressed that “we should be very careful because increasing the excise tax on fuel has inflationary tendencies.”
“When you talk to ordinary cigarette vendors on the sidewalk they will say that a 4% inflation would affect their ability to purchase the basic commodities. Let’s not underestimate that,” he said.
Drilon instead proposed to raise the sin taxes, saying it’s a “rich source of revenue” and a “health measure.”
“Why not increase the sin taxes? Because cigarette is a vice and I was the one who increased the excise tax on liquor and cigarette five years ago. Right now we are generating from the additional taxes on cigarette by nearly a hundred billion a year,” the senator said. /je
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