News Release
December 26, 2014
The labor group Partido
Manggagawa (PM) supported the view of Senator Allan Peter Cayetano that unless
trillions of pesos of lost revenue due to smuggling, tax evasion and official
corruption is plugged, the removal of MRT/LRT subsidy is painfully and socially
unjust.
“Subsidy
is a good social policy. It is a right, an entitlement of poor people
while corruption and fraud are privileges enjoyed by the rich and powerful.
By removing the subsidy, the government is renouncing a good
policy,” said
PM spokesman Wilson Fortaleza.
Quoting
the World Bank, Cayetano said in every P1 collected by the government, P2
remain uncollected. This is estimated to be between P2 to P4 trillion of lost
revenue or bigger than the recently approved budget of P2.6 trillion.
The
Senator said he will take up this issue next year amid the plan by the
government to remove government subsidy to the metro rail system. The plan will
double the MRT and LRT fares beginning January 4.
The
labor coalition Nagkaisa in which PM is a member will be meeting next week to
draw up plans against the impending fare hike.
Fallacy
Fortaleza
said removing the P7-P10 billion annual train subsidy to free up money for
other social services is a fallacious argument, saying the poor, who are entitled
to government subsidy in varying degrees, should not, by class or geographical
locations, be pitted against each other.
“This
is comparable to the fact that businesses across all industries also enjoy
billions of pesos of subsidy in the forms of tax holidays, financial
assistance, free repatriation as well as import and export privileges.
For instance the power industry, the most lucrative business in the country
today, received a total of P5.2 billion of subsidy in 2012, according to the 2012
Census of Philippine Business and Industry,” said Fortaleza .
Revenue
and job loss
The
labor group likewise bewailed the huge revenue losses coming from tax evasion
and smuggling, saying the failure to address this age-old problem created a
‘pass-on’ culture in public policy.
“This
is the reason why the burden shifted heavily to indirect taxes like VAT and
taxes withheld from wage earners. At the same time smuggling creates
abundance of cheap imported goods at the detriment of local producers.
And now the removal of subsidies,” lamented Fortaleza .