Duterte’s TRAIN will Collide with Workers’ Livelihood

Workers belonging to the Sentro ng mga Nagkakaisa at Progresibong Manggagawa (SENTRO) and the Philippine Airlines Employees Association (PALEA) today picketed the Senate to express their opposition to the Tax Reform for Acceleration and Exclusion or TRAIN.

The labor groups, both members of NAGKAISA Labor Coalition, believe that tax reform is long overdue. For years, workers have been demanding a shift from taxing consumption (a regressive tax system) to one that is based on income (progressive taxation). Unfortunately, Duterte’s TRAIN, as it is currently crafted, is taking the wrong way.

“We welcome lower tax on personal income but reject the regressive impact of excise taxes,” Gerry Rivera, president of PALEA said. “With TRAIN, the government intends to ease our tax burden by forgoing P140 billion in personal income tax, only to collect from us P190 billion through VAT-based expansion and excise taxes!,” Rivera added.

This morning, the Senate is holding a public hearing on TRAIN, specifically on the excise taxes it will impose on petroleum products. The Department of Finance (DOF) proposed to earmark 40% of the PHP 73.7 billion incremental revenues from the oil excise tax (for 2018 alone) to fund targeted transfers through Pantawid Pasada program and the Jeepney Modernization Plan.

The Jeepney Modernization program of the Department of Transportation (DOTr) will phase out PUJs that are older than 15 years. The program will forcibly replace 205,000 of the 234,000 registered jeepneys that are currently in use in the country. Initially, the DOTR wanted to extend new franchises only to big operators who able to deploy at least 10 jeepneys. “Had we not launched transport strikes against this policy, the DOTr would have displaced at least 410,000 drivers and small operators by now,” Cruz said.

“The tragic thing is, government wants to take away our livelihood from us by phasing out our jeepneys,” Ernie Cruz, national president of the National Confederation of Transportworkers Unions (NCTU), bemoaned. “Now it is saying that it would tax us to death in order to modernize our jeepneys,” Cruz added.

“The problem is, the government has yet to demonstrate that their Jeepney Modernization Plan is accessible to ordinary jeepney drivers and operators,” Cruz complained. “The DOF, through the TRAIN, in its current form, may just succeed where the DOTr failed – deprive us of our livelihood,” Cruz declared.

The labor groups support NAGKAISA’s position to prioritize tax administration reform and de-link personal income tax from regressive tax measures.

“We call on the Senate to pass the personal income tax (PIT), but derail the rest of the TRAIN for now,” Rivera declared.

Leave a Reply