MANILA – A senior member disclosed the Philippine House of Representatives is bent on passing a bill that aims to impose taxes on text messaging rather than on “sin products,†especially cigarette, beer and liquor.
Congressman Exequiel Javier of Antique province in the Visayas, the chairman of the House Committee on Ways and Means, explained that imposing a five-centavo (0.01 US cent) on text messages is more doable than the proposed tax on cigarette and liquor whose sales have dropped by as much as 36 percent in the past six months.
Javier cited a report from the Bureau of Internal Revenue that the drop in sales was mainly due to the effects of the deepening global recession which forced many Filipinos to cut down on their consumption of the sin products.
In her state-of-the-nation address to the joint session of Congress on July 27, President Gloria Macapagal-Arroyo pushed for higher taxes on cigarettes and liquor to raise money for the government.
But Congressman Eric Singson of Ilocos Sur province in Northern Luzon, the committee’s vice chairman, warned that even officials of the Department of Finance are having second thoughts about the imposition of additional taxes on sin products.
“With the drop in sales of these products, there is a big possibility we might do more harm than good for the country,†warned Singson whose province is one of the country’s biggest producers of Virginia and native tobacco.
He also warned that additional taxes would adversely affect millions of farmers in Northern Luzon, who depend on the industry as a major source of income.
Singson agreed with Javier that the bill imposing taxes on text messages would enable the government to get cash quickly and thus, help to ease partially the fiscal deficit projected at $50 million for 2009.
For one thing, Singson said that a tax on text messaging has been long in coming considering that the Philippines is known as the “texting capital of the world.â€
But Javier said such tax on text messaging should be done in such a way that telecommunication companies would not pass this on to the millions of users of cellular phones nationwide.
To achieve this, Singson filed a bill prohibiting these companies from passing on the additional tax burden to their customers.
Another bill, proposed by Congressman Danilo Suarez of Quezon province in Southern Luzon, seeks to allocate the funds to be earned from the tax on text messaging to the purchase of equipment for computer education and laboratories.
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