Zarate to file bill repealing ‘regressive’ provisions of TRAIN law

A party-list lawmaker is set to file a bill which aims to “truly reduce” the tax burden on the poor by repealing the “regressive” provisions of Tax Reform Acceleration and Inclusion (TRAIN) Law.

Bayan Muna Rep. Carlos Zarate on Tuesday said the bill would propose a higher income tax exemption than the current P250,000, and would repeal “regressive” taxes under the TRAIN Law which includes the expansion of value added tax (VAT) coverage, additional excise taxes on petroleum products and the excise taxes on sugar-sweetened beverages.

“We will then file a bill that aims to truly reduce the tax burden on the poor majority by repealing the regressive provisions of TRAIN Law… We need a more progressive taxation system now and not one that preys on the poor,” Zarate said in a statement.

For the militant lawmaker, many Filipino consumers, particularly the ordinary working class, are “already reeling from the adverse and dissipating” effects of Republic Act 10963 or the TRAIN Law which was passed in January this year.

“We need not wait anymore for even more adverse effects, more price shocks, affecting especially the poor, before Congress should decisively act. What is needed now is not just to review but even repeal the regressive provisions of the TRAIN law,” he said.

“Hundreds of workers under Coca-Cola were laid off, prices of petroleum products rose, and prices of basic goods and service followed suit. Rice, which is supposed to be VAT exempt, became more expensive by P1-2 per kilo. Also there was a P10 increase per kilo for beef, meat and pork lean meat and P2 to P20 per kilo increase for dressed chicken and all these are being blamed on TRAIN,” he added.

Zarate also noted that fares for Grab vehicles have increased while fare hikes for public utility jeepneys and buses are in the offing. Electricity charges also increased since February 2018, he added.

The congressman said the Department of Economic Research of the Bangko Sentral ng Pilipinas (BSP) said that April inflation may reach 4.7 percent while, the Philippine Statistics Authority (PSA) on April 5, reported an inflation rate of 4.3 percent in March, higher from the revised 3.8 percent in February.

“As it is, the impact of TRAIN among the poor Filipinos could not be denied. While the TRAIN law provides income tax exemption for those earning below P250,000 annually, it actually levies higher tax burden to the poor majority with the removal of some VAT exemptions and introduction of new excise taxes on petroleum products and sugar-sweetened beverages,” he said.

Instead of “heavily taxing the poor through VAT and excise taxes on petroleum products and sugar-sweetened beverages,” Zarate said higher taxes should be levied on those who have more capacity, in our case, the big foreign and local corporations and landlords.”

“The poor and low-income families, on the other hand, should be taxed as lightly as possible while provided with the much needed publicly-provided social and economic services,” he pointed out.

The TRAIN Law imposes higher excise taxes on fuel products, cars, tobacco, and sugar-sweetened beverage, but it also increased the tax-free cap of 13th month pay and other bonuses to P90,000, as well as the tax income exemption to P250,000.

READ: Zarate: Inflation to continue to rise due to Train            /muf