A campaign spending tax favors the national government because it will “pinpoint opposition donors from the business community," a critic of the Arroyo administration said.Imposing the five percent tax would reportedly allow the administration “to employ every trick in the book to harass and intimidate our financial backers," Makati Mayor Jejomar Binay said in an article posted on the city’s web portal.
“Opposition donors will now be vulnerable to harassment, and will think twice about supporting those of us in the opposition," he said.
Even the Commission on Elections (Comelec) has “serious doubts" about the new tax measure’s legality and propriety, said Binay, a running mate of former President Joseph Estrada.
In the same story posted at the Makati City’s web portal, Binay also underscored the lack of public discussion about the issue.
No less than Comelec chairman Jose Melo reminded the BIR that there is no law that taxes political contributions.
"There is a need to clarify the scope of coverage since the law exempts electoral contributions from any form of tax," Binay said.
Under the BIR’s Revenue Regulation 8-09, candidates and political parties are required to register as the agency’s withholding agents.
They will also be prompted to issue receipts for goods supplied and services rendered during campaign activities and remit five percent.
The BIR, the Philippines’ premier revenue agency, intends to raise an additional P1.4 billion from the measure, a move that will help it meet its collection goals for the year.
The BIR is currently headed by senior deputy commissioner Joel Tan-Torres who is also the officer-in-charge after Sixto Esquivias IV resigned over the weekend.
At the same time, the national government only needs to improve tax collection and go after smugglers if it seriously wants to improve its revenues, Binay said.
The national government loses around P140 billion yearly because of smuggling, Binay said, citing reports.
Estimates of losses due to tax evasion, has been pegged at 35 percent, which is equivalent to P279.5 billion based on the BIR's collection target of P798.5 billion this year.
"If the national government wants to address the deficit decisively, it can begin by going after tax cheats and smugglers. Assuming it collects only half of these estimated losses, it can more than cover the P237.5 billion deficit from January to September this year," he said. - GMANews.TV
Source: http://www.gmanews.tv/story/176277/campaign-tax-will-allow-arroyo-govt-to-harass-opposition-donors
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