ESCUDERO PRODS GMA TO CERTIFY TAX BREAK BILL IF SHE'S SERIOUS ON ECONOMIC RELIEF PLAN

Senator Chiz Escudero today asked the government to stop its "good cop, bad cop routine" on higher personal income tax exemption and decide officially if it wants it legislated

Escudero, chairman of the Senate Ways and Means Committee said he is getting mixed signals on the issue, with the Palace issuing statements that it is for tax breaks while finance officials, citing revenue losses, warning not to push through with it.

The senator's call for policy cohesion on the part of the executive came in the wake of President Arroyo's reported approval of a P75-billion economic stimulus package which includes tax break for lower-income families that would cost P16 billion.

"Because this can only be done through legislation, then what the President should do is send us a bill and certify it as urgent. Or she can choose from any of the measures pending in the House or in the Senate and certify it", he said.

"It's time to walk your talk Mrs. President. You can not just titillate the public of promises of tax breaks without making a serious follow through, "he said.

If the president wants an economic stimulus package, Escudero said she then can stimulate congressional action on it by certifying a tax break bill as urgent.

Escudero said the Senate had done its part and the bills for tax breaks have now been heard, consolidated, reported out, and ready to be debated on the floor.

He cited Senate Bill No. 103 (SB No. 103), an act exempting from individual tax workers in the private sector receiving minimum wage, as well as government workers in salary grades 1 to 3, Senate Bill No. 126 (SB No. 126), an act reducing the income tax rates of individual taxpayers, Senate Bill No. 125, an act increasing the allowable personal additional exemptions of individual taxpayers and Senate Bill No. 302, an act granting unmarried women with children same basic personal exemption and additional exemption for dependents as enjoyed by married women are only few of the bills that have been heard and concluded in his committee that are just awaiting certification as urgent from the President.

Escudero said Finance officials invited to Senate hearings on the above bills have warned against the expansion of personal income tax exemptions, saying the ensuing revenue loss would derail the government's fiscal recovery and balance budget plan.

"The simulations we have made showed that exempting minimum wage earners, based on 2004 data, would benefit 1.07 million tax filers but would result in P5.16 billion in foregone revenues yearly."

"The tax breaks translated into disposable income would range from P380 to P6, 640 a year per tax filer. Yet, Finance officials frown upon this, despite the fact that total tax forfeited is not even one half of one percent of total tax take for 2008, "he said.

"Eh kung sa P5.16 billion umaangal na ang mga taga DoF , sa P16 billion pa kaya ?," he said.

"It is also wrong to say that these taxes will be lost forever because because these can be recovered in the form of sales tax, or VAT, when these freed amounts will be used to buy goods and services," Escudero ended.