‘Trillions lost to smuggling, tax fraud’

Senate Majority Leader Alan Peter Cayetano. INQUIRER FILE PHOTO

The amounts lost to smuggling and tax evasion are bigger than those lost to ghost projects and employees, according to Sen. Alan Peter Cayetano.

Cayetano, quoting the World Bank, said that for every P1 collected by the government, P2 remained uncollected.

“This means tax evasion and smuggling are the bigger corruption, because between P2 trillion and P4 trillion does not enter the government coffers,” Cayetano said in an interview over dzRH radio.

He said this was bigger than the portion that got stolen from the P2-trillion budget due to corruption. He estimated that about 20 percent of the budget got lost because of unscrupulous activities.

By January, he said he would take up this issue, considering the staggering amount that should have gone to the government.

This was especially significant since the government, in a bid to channel more funds to social services, would increase MRT and LRT fares starting Jan. 4.

This would allow part of the subsidy for the commuter trains to be freed up and used for other purposes.

Commuter groups and lawmakers have castigated the move, saying the dismal conditions of the trains made the looming fare hike an unjust and unfair move.

Had the proper amounts been collected, train fares would even have gone down instead of up, according to Cayetano.

The senator said that in fighting corruption, it was not enough that a public official was clean.

If everybody around him is corrupt, he must offer a solution to change the environment. One solution, according to the senator, is increasing the salaries of government personnel.

He said this was part of the formula used in Singapore to battle wrongdoing in government.

In Singapore, not only were corrupt officials jailed, government officials were also given commensurate salaries, he said.

“As long as their salaries are low, they would be tempted [to stray],” Cayetano said in the radio interview.

“Try being in a situation where you are unable to feed your family. It’s human nature,” he added.

RELATED STORY

DOF seeks quicker action on tax evasion, smuggling cases