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Palace blinks on text tax measure

By TJ Burgonio
Philippine Daily Inquirer
First Posted 04:04:00 09/12/2009

Filed Under: State Budget & Taxes, mobile phones, Telecommunications Services, Legislation, Consumer Issues, Overseas Employment

MANILA, Philippines ? Wary about the possible political impact of the proposed tax on text messages, Malacañang Friday called on lawmakers to revise the measure and spare cell phone users of unnecessary burden.

?If you see objections coming from both sides of the fence, there is really a room for further study,? presidential economic spokesperson Gary Olivar said. ?Plus, there?s new information coming from the telecoms. Maybe, some revisions are in order.?

Several senators, including Senate President Juan Ponce Enrile, have also opposed the measure.

In a statement Friday, Sen. Francis Escudero said he would oppose the bill if it was taken up in the Senate, and added: ?There is no certainty, however, that it will not be passed by the chamber.?

?The proposed tax is obviously a regressive measure and will be an added burden for students, workers and minimum wage earners who use the cell phone as an essential tool for communication,? Escudero said.

Overseas Filipino workers joined the growing opposition to the proposed tax on text messages.

Migrante-Middle East, an alliance of OFWs in Saudi Arabia and neighboring countries, denounced the lawmakers for adding to the burdens of overseas workers and their families.

?This government is killing OFWs and their families so softly,? John Leonard Monterona, Migrante-Middle East regional coordinator, said in a statement.

?OFWs and their families vow to oppose this tax on text messages. Migrante chapters in the Middle East are going to campaign against tax-on-text proponents in Congress in next year?s elections,? Monterona said.

Olivar agreed on the need for lawmakers to thoroughly review the measure in view of new points raised by several sectors on its adverse impact on consumers.

He cited Smart Communications? contention that the proposed 5-centavo excise tax on each text message would eliminate its ?bucket-priced plans,? including its unlimited text plans for the masses.

?I guess my question is, how come we didn?t know about the effect of this bucket-pricing on the effective rate of telephone? This is a new piece of information and, therefore, it still needs to be studied closely,? Olivar said at a news briefing.

No pass-on to users

According to the ericsson.com, bucket pricing is perceived as a near flat rate by customers. Under this principle, subscribers ?pay a set fee and have a set number of minutes to use per month.?

The House ways and means committee has approved the tax measure, with lawmakers assuring the public that the ?no pass-on? provision in it would be restored in the final version of the committee report.

Malacañang the other day said it was supporting the measure if there was a clear mechanism that such a tax would not be passed on to consumers.

Olivar said he believed that lawmakers were now carefully studying the measure in view of strong objections to it.

?I?m sure the legislators are doing this very carefully,? he said. ?We?re talking about a major industry in our country. We?re talking about a major revenue gain that, however, could create a political issue. And last, but not the least, to my mind anyway, we don?t want to be sending the wrong messages or the wrong signal to the investors, especially the investors from outside.?

Malacañang watching

Olivar said the proposed tax was not part of the raft of revenue measures that Malacañang had endorsed to Congress. He, however, said that Malacañang could not tell lawmakers to scrap it altogether.

?I don?t think it has been certified as urgent,? he said, adding: ?Regardless of how the Executive feels about this, in any case, it?s already in Congress. It?s a live bill that is working its way to Congress.?

?All the Executive I guess can do is monitor the process, make sure the issues have all been adequately addressed,? Olivar said.

Common front

The Blas F. Ople Police Center, a migrants? welfare advocacy group, said it had begun talks with other OFW and labor groups toward adopting a common stand against the tax-per-text-message proposal.

In a statement, Susan Ople, the center?s president, questioned the appropriateness of the measure, citing the economic crisis that has hit workers and their families.

She said she and Filipino Migrant Workers? Group head Jun Aguilar agreed the proposed tax would hit the OFWs and their families, many of whom rely on text messaging to talk to each other.

Only ?gud nite?

Monterona claimed those who favored the bill failed to understand the dilemma of overseas Filipinos who frequently use international roaming SIM cards to communicate with their loved ones back home.

?Using my roaming SIM card, I usually consume my P100 load for about 5 text messages to my wife and kids. Now if tax will be imposed, probably I could only send 2 or 3 text messages to my wife, limiting me to only say to her ?I luv U? or ?gud nite,?? Monterona said. With a report from Jerome Aning



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