Gordon for, Lacson against text tax
By Dona Pazzibugan
Philippine Daily Inquirer
First Posted 20:30:00 09/30/2008
Filed Under: mobile phones, State Budget & Taxes, Telecommunications Services
MANILA, Philippines—Senator Panfilo Lacson has disagreed with Senator Richard Gordon in reviving a proposal to tax text messages.
Under his Senate Bill 2402, Gordon would have telecommunication firms taxed 20 percent of their income from text messages, with the taxes amounting to billions of pesos annually to be spent specifically on education and health.
Anticipating protests from the public, Gordon said his proposal should not raise the cost of a text message currently at P1 per text message since ideally, telecommunication firms would only part with a portion of their profits.
Even so, Lacson protested Gordon's proposal and insisted that neither consumers nor the telecommunication firms should be further taxed.
Before telling telecommunications companies to practice "social responsibility" by allotting 20 percent of their text message profits to a special fund for health and education, the government should first practice some responsibility of its own in collecting taxes efficiently, said Lacson.
"Why impose added conditions on texters and telecommunication companies when all the government has to do is plug its tax loopholes and use the 'savings' in the budget? With the 'surplus' in the budget, there is no need for such 'tax,'" he added.
The opposition senator also pointed out that the government earned a "windfall" of revenues from the 12-percent value added tax (VAT) on oil products earlier in 2008 when oil prices were record-high.
When told of Lacson's comments, Gordon said his proposal did not intend to pass on any new tax to the more than 60 million mobile phone subscribers.
"While I share his frustration over the government's inefficient tax administration and collection system, a careful reading of my proposal shows that there is no tax intended to be imposed and definitely, the brunt of it would not to be passed on mobile phone subscribers," said Gordon.
"We want to move our country in the right direction, and we don't want to go back to policies that have failed us in the past as a nation and as a people. We are finding innovative solutions to decades-old problems of education and health care services," he added.
He estimated that 400 million text messages are sent each day in the country, with each text message costing P1.
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