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November 18, 2004

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Call of duty...

THE NEED TO PERSONALLY OPEN THE BUDGET deliberations prevented Speaker Jose De Venecia, Jr. from joining The Makati Business forum last Thursday as previously arranged. Up to 7 p.m. of the previous day, the office of speaker De Venecia confirmed his desire to accept our invitation to be our guest of honor during last Thursday's forum. By 10:30 p.m. of Wednesday, however, colleagues in Congress emphasized to the Speaker the importance of his presence when Congress convenes at 9:30 Thursday morning to deliberate on the National Budget.

We look forward to possibly have the Speaker with us by the middlw of December, to share with the business community and the media the initiatives that Congress as a collective body has done to address the country's foreign debt management, curb graft and corruption, improve tax revenue collection, bring down government expenditures, increase productivity, create more jobs and, to echo his recent advocay, "create new wealth".

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Increased revenue from sin taxes may prevent cut in LGU's IRA

SANDY PAREDES, EXECUTIVE DIRECTOR OF THE UNION OF Local Authorities of the Philippines (ULAP), said that she favors increasing the tax on so-called "sin products" like cigarettes and liquor. Paredes further said that she is also in favor of the "lateral attrition bill", which proposes to reward revenue officials who meet the targets and remove those who cannot as a measure of increasing government revenue collection. Paredes, who was celebrating her birthday that day, cut short her Davao trip to be able to attend and participate in the forum. She represented Bohol Gov. Erico Aumentado who is the national president of ULAP.

“Sin taxes will help a lot in increasing revenue collections to reduce our budget deficit and prevent the government from suspending a part of the release of the internal revenue allotment due to the local government units,” Paredes said. “Although the law pronounced unconstitutional any cut to IRA, since it totally disregards the clear provisions the 1987 constitution, and illegal because it contravenes the provisions of the 1991 local government code, Malacañang may still do so in the event that the national government incurs an UNMANAGEABLE PUBLIC SECTOR DEFICIT,” Paredes explained. “But in no case shall the allotment be less than 30% of the collection of national internal revenue taxes of the 3^rd fiscal year preceding the current fiscal year,” Paredes stressed.

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JDV’s formula of creating new wealth

During the meeting of ULAP with President Gloria Macapagal Arroyo last November 9; the president encouraged the creation of new wealth, as advocated by House Speaker Jose De Venecia, Jr., by exploring other facilities like mining and reclamation. “These will give the government increased revenue,” Paredes said. Environmentalists, however, oppose the proposal on the grounds that mining activities will jeopardize the environment.

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Big business should pay local taxes

“Some LGUs are less dependent on IRA because they have good collections of business and real property taxes,” Paredes also said. However, out of the 75% total taxes collected, businessmen in the provinces doing business in Manila are paying 25% of them in Manila, she added. LGUs are encouraging these businessmen to spread their tax payments by paying corresponding taxes on income derived from the localities where they have business operations. ULAP is conducting dialogue and consultations to explain to business leaders in Manila the benefits they can offer to local government units if they start doing this.

Paredes also said that LGUs don’t have problems with the disbursement of their IRA since they are all accounted for. It is in the national level where budget deficits are incurred, she said.

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“Billionares’ Club” to act as big brothers

Paredes announced that ULAP has a project to be launched in December this year involving the LGUs in Metro Manila with IRAs of P1-billion and above. They are called the “billionaires club” of LGUs. Out of the 42,000 LGUs all over the country, 28 belong to the “billionaires club”. This includes 10 provinces, including the MMDA, and 18 cities, 12 of which are in Metro Manila.

This group agreed to contribute a specific amount each to form a pool of funds from which donations can be made to marginalized barangays all over the country. Acting like big brothers the group will choose their particular adopted barangays and provide them financial assistance. Manila-based LGUs can further assist marginalized barangays by transferring to them skills and expertise in local governance. (Excalibur News)

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Poverty of values

Atty. Monina C. Camacho, executive assistant to the president of the League of Provinces of the Philippines (LPP), shared Paredes’ views on sin taxes, IRA and mining.

She emphasized, however, that there is a need for value transformation among our people, especially in the grass roots level, for them to be more responsible leaders and better citizens.

Atty. Camacho, herself a former mayor in her hometown, represented LPP President Bohol Gov. Erico Aumentado.

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The Dole out syndrome

“The government she said has not stopped helping our folks in the provinces, even those who live in the remotest barangays. But what prevents these people from progressing is their attitude towards the government resources they are receiving,” she lamented. “Whatever assistance they receive are not taken seriously and no conscientious effort is exerted to maximize the benefits from the aid,” she observed. “Sadly, whatever credit facilities extended are regarded as dole outs,” she continued.

“That is why no payment is being made to keep the funds rolling to continue to serve more of those in need,” Atty. Camacho explained. “This attitude and response from people make the government leaders think twice before they decide to continue whatever good projects it has for them,” she added. “There is indeed a need to empower the basic quality of education to produce good leaders and citizens for our country,” Camacho concluded. (Excalibur News)

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(Seated fr l-r) NBN 4’s Miguel Gil, Atty. Monina Camacho, exec., League of Provinces of the Phils., Sandy Paredes, executive director, Union of Local Authorities of the Phils., Esther Gallardo, forum moderator, Central Luzon Media Ass’n. and our very own ceo, Excalibur PR Mgt. Consultants, forum host. (Picture Below)The Makati Business Broadcasters, NBN 4, GMA 7 and IBC 13 covered the event.

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