On Tax Reform for Acceleration and Inclusion (TRAIN) Package 1

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Labor coalition welcomes lower tax on personal income but rejects regressive impact of excise taxes.

Workers have long been demanding for higher tax exemptions, hence, the approval by the House of Representatives of Package 1 of the Tax Reform for Acceleration and Inclusion (TRAIN) is a welcome relief.

Under the TRAIN, income lower than P250,000 per year will be tax free while higher income brackets, except for those who earn more than P5 million, will be charged a lowered tax rate of 25% from the current high of 32%.

This is surely a welcome development. But for the labor coalition Nagkaisa, the workers’ gain in Personal Income Tax (PIT) will be offset in a regressive manner by the imposition of excise taxes on fuel products and the lifting of VAT exemptions in the sale of specific goods and services.

“Everyone knows, not just workers, that it will increase prices of goods and services that would affect mostly the poor and those at the lower income brackets,” said Nagkaisa spokesman Renato Magtubo.

Magtubo said the TRAIN’s objective of shifting the tax burden from the poor to the rich, “Seems to be scheming if not tricky as forgone revenue on the side of the government, which is equivalent to individual savings derived from lower PIT of specific income group, shall be recovered in a universal manner through excise taxes and expanded VAT.”

The group explained further that the tax base can never be expanded through exemptions in PIT and corporate income, making indirect taxation through excise taxes and VAT expansion the main strategy in generating new and more revenue. “Otherwise, nobody is going to pay for the lost revenue,” added Magtubo.

Under TRAIN’s package 1, a P3.00-P6.00 excise taxes will be imposed per liter on fuel and P10 for locally produced sugary products while several VAT-exempt products and services will be lifted, including cooperative income exceeding the P3 million thresholds. Likewise, sale of real estate for socialized housing will now be covered by VAT.

According to the group, even the simulations made by staffs of the finance department showed the inevitable impact of increase in VAT payments by decile group – 43% for the richest 10% and 35% for the bottom 80%. Increase for the second richest 10% is 22%.

“An increase of 43 and 22 per cent respectively may mean nothing for the richest 20% who got significant savings from PIT exemptions. But a 35% increase is surely a burden for the bottom 80% who includes the majority in the formal and informal sector, employed and unemployed, of the working class. In the same manner everyone will be paying for the direct and indirect impact of excise taxes on fuel,” explained Magtubo.

The labor leader added that those living in SPUG areas which rely on diesel as their single source of power will be absorbing a “minimal” impact, according to DOF. But that would mean additional P84 for those who consume 100 kWh per month and P106 for those who consume 300 kWh.

“These are the immediate impact that will hit everyone while the poor wait for the promised transfers contained in the proposed expenditure programs of the government,” said Magtubo.

The group said it will intervene in the continuing deliberation of the tax package in Congress especially on the proposed lowering of income taxes for corporations from 30% to 25%.

“Our main question for this is why a tax rate on corporate income, which is supposed to be a tax on profit, is being lowered down to the same level of personal income which is a tax on labor? A uniform rate on business and personal income can never be considered progressive taxation,” concludes Magtubo.”

PRESS RELEASE
NAGKAISA
13 June 2017

Workers group sees danger in unqualified declaration of martial law for entire Mindanao

 

Nagkaisa Labor Coalition on Labor Day 2017

The Philippine Constitution under Article 7 Section 18 granted the President the power to declare a state of martial law. But such a declaration should meet certain requirements to justify suppression of lawless violence, invasion or rebellion and the suspension of the writ of habeas corpus.

We condemn and will continue to oppose any act of terrorism perpetrated by any group in any part of the country. And while we recognize the power of the President to address security emergencies like this one, we also will not disregard the danger posed by unqualified use of military power to deal with security threats at the expense of democracy and basic human rights. Filipinos will never forget the dark days under fourteen years of martial law.

In line with this, we find the Moscow declaration of President Duterte placing the entire Mindanao under the state of martial law as worrisome as it came with yet to be qualified basis except for the pockets of violence that erupted yesterday in Marawi City between the military and the combined forces of Maute and Abu Sayaff groups. Why place the entire Mindanao under a state of martial law when the military itself claimed it is in full control of the situation?

Even the fire and storm of Misuari in Zamboanga nor the firefights in Ipil were not sufficient cause for a declaration of Martial Law. Indeed, if there is any lesson, Mindanaoans have demonstrated in the last 40 years, is that they best cooperate, cohabit and interact with each other WITHOUT Martial Law. The historical memory of the Filipino race has been so foreshadowed by the totalitarian menace that even now, we feel more threatened than secured by the State under Martial Law. Workers will never forget, especially when workers’ rights to organize, to bargain and to strike occupy such a low level of political esteem from the powers that be. We ask all to step back from the totalitarian temptation.

Furthermore, the Filipino people deserve the right to be properly informed on matters of national security especially when their rights and welfare are affected by executive decrees, including military actions that reign supreme over civilian authority during a state of martial law.

Lastly, we call on the Congress and the Supreme Court to exercise their oversight powers over the President on the issue of martial law, and for the Filipino people to remain vigilant during these difficult and challenging times.

NAGKAISA Labor Coalition
PRESS STATEMENT

We condemn the declaration of Martial Law ! -iDEFEND

IDefendOn Tuesday night, President Rodrigo Duterte declared Martial Law on the entire Mindanao Island while on a state visit in Russia, following the fighting between the military and the Maute group.

It has to be clarified that the clashes were triggered by law enforcement operation in Marawi. This is a situation started by the government itself. Similarly, the Maute group is a local terrorist group, and not ISIS, even as the former tries to ally itself with ISIS.

We condemn the violence perpetrated by the Maute group to advance their political interest. Attacking civilian population not party to the conflict between government forces and the Maute violates duly recognized human rights of the people and violation of International Humanitarian Law on armed conflict.

While the fighting has endangered the life of civilians in the area, Martial Law does not alleviate this danger nor ensure the resolution of conflict and achievement of peace. Note that the National State of Emergency Due to Lawless Violence, declared after the Davao bombing, is still in place nationwide.

Martial Law adversely affects civilians as this would curtail many of their rights. Without Martial Law, the military has engaged and fought terrorist groups in Mindanao and can continue to do so as their obligation and mandate.

With Martial Law, the civil and political rights of the civilians, and their lives, are endangered more than ever. Confusion and insecurity among communities may be taken advantaged of by different armed groups, furthering the violence in Marawi, and the rest of Mindanao. Human rights abuses are bound to happen, especially under a presidency which has openly shown no respect for human rights. It could potentially endanger striking workers and other protesting activists in Mindanao.

The public has the right to be informed of the situation in Mindanao and as of the declaration of Martial Law, a lot of questions remained unanswered. Defense Secretary Lorenzana himself told media that “there is intelligence” about the situation in Marawi, but that this intel has been wrongly interpreted. If the situation in Marawi had to do with weaknesses in the execution of its job, Martial Law, and over the entire Mindanao Island, is NOT the answer to this shortcoming or failure.

The 1987 Constitution has limited the President’s powers to place the country or any part of it under martial law to two situations – invasion or rebellion – and only when the public safety requires it. Clearly, only compelling reasons must justify martial law. The current situation does not constitute sufficient factual basis for the proclamation of martial law or the potential suspension of the privilege of the writ of habeas corpus.

WE CALL ON THE CONGRESS TO REVOKE THE DECLARATION OF MARTIAL LAW!

Martial Law is Not the Answer!

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The Sentro ng Nagkakaisa at Progresibong Manggagawa (SENTRO) condemns the atrocious attack on the people of Marawi perpetrated by a local terrorist group. We solidly stand with them in this tragic moment. We believe, however, that the declaration of Martial Law is a heavy-handed response to the situation that even the AFP now claims is under control.

It is in this light that SENTRO condemns the declaration of Martial Law and joins the growing clamor of various social movements, civil society organizations and concerned citizens around the country, especially in Mindanao, in calling for the rescinding of the declaration of Martial Law in Mindanao.

The real possibility of a state of martial law being utilized for counter-insurgency and the suppression of civil liberties, including workers’ and trade union rights, is a well-founded fear of our people due to our two-decade experience of dictatorship. While the 1987 Constitution (under Art. 18, Sec. VII) has significantly constrained the latitude of abuse a state of martial law may entail, a pliant Congress does not inspire institutional confidence.

We are also calling on the recalibration of transparency ofinformation access regarding the unfolding crisis. While we respect the need for confidentiality and classification the AFP and PNP demands for such a sensitive operation, the humanitarian cost and the very real distress the relatives and friends of Marawi residents all over the country are experiencing also demand due diligence andresponsibility. Rescue the victims, pursue the perpetrators.

In placing Mindanao under Martial Law, the Duterte administration, ironically for a
Mindanao-based leadership, is merely repeating what other administrations have done – to treat Mindanao as a frontier to be subdued rather than governed.

Peace for Mindanao. Stop the War.

CALL TO ASEAN LEADERS: REJECT RCEP AND OPPOSE UNJUST TRADE DEALS

SENTRO and FDC lead a protest action in front of the Department of Foreign Affairs in Manila against RCEP. May 10, 2017.

Trade Justice Pilipinas a broad platform campaigning for just trade and investment policies expresses its opposition to the Regional Comprehensive Economic Partnership agreement or RCEP.

We urge the leaders of the ASEAN members’ states to defend the primacy of human rights, environmental integrity and peoples’ welfare against international economic agreements like RCEP that advance commercial interests and the corporate agenda, and impinge on the ability of the government to advance the greater public interest.

Furthermore, we call on the Philippine government, as Chair of ASEAN for 2017, to demonstrate leadership in raising the peoples’ concerns against RCEP during the 18th round of talks here in Manila.

In the Chairman’s Statement from the 30th ASEAN Summit in Manila, Member States led by the Philippines, reiterated the common vision to build a truly inclusive, people-centered, and people-oriented ASEAN community and stressed the centrality of ASEAN in the RCEP talks.

We assert that RCEP and other new generation free trade and investment agreements ran counter to the vision of a people-centered ASEAN. Contrary to the view expressed by ASEAN leaders that the RCEP talks have progressed considerably, the direction of the talks have in fact moved backwards with the agenda becoming more ambitious therefore demanding deeper commitments from parties. RCEP has become in many respects worse than the Trans Pacific Partnership Agreement or TPP.

Our opposition to RCEP is anchored on the following concerns:

RCEP is a threat to public health and peoples’ access to medicines. The proposed agreement with TPP+ provisions on intellectual property rights will make it harder for poor people in the region to access affordable medicines particularly life-saving drugs, and for governments to advance public health policies for the benefit of the poor. The IPR chapter and many other provisions in the proposed agreement could undermine State policies on public health enshrined in Constitutions and national health laws like the Cheaper Medicines law in the Philippines.

RCEP will give corporations–many of which have annual revenues bigger than the GDPs of most countries in ASEAN, the right to sue governments over public policies and regulations in secret, ad-hoc corporate courts.

The investor state dispute settlement provision or ISDS, which has been highly criticized in the context of TPP negotiations, should be strongly rejected as well by ASEAN governments as an instrument that will weakening the right of State to regulate investments in the name of the greater public interest.

RCEP will straight-jacket governments, curtailing their power to use public policies to advance development agenda by putting in place prohibitions on performance requirement such as policies on domestic content and export restrictions, policies that favor employment of locals over foreign workers or even those that push for technology transfer.

Amidst the continuing backlash against globalization policies that have disenfranchised and marginalized the working class, the imperative is really to push back on RCEP and new generation trade and investment agreements that advance the corporate agenda over peoples’ interests.