FRANCE said Philippines must tax Text Messaging : Malacañang said NO WAY

No Tax On Text messaging in the Philippines. Photo: ticklethewire.com

No Tax On Text

MANILA, Philippines --- Mobile phone users should not fret about a purported looming tax on text messages for now after Malacañang appeared reluctant to consider such tax proposal made by the head of the International Monetary Fund (IMF).

Presidential spokesman Edwin Lacierda said yesterday the government is "preoccupied" with seeking the swift approval of the sin tax bill in Congress for the year.

Certified as urgent by President Benigno S. Aquino III, the sin tax measure seeks to generate at least P40 billion a year to help upgrade healthcare services in the country.

"We are presently preoccupied with the sin tax," Lacierda said in a Palace press briefing when asked if the Palace is open to impose tax on text messages.

"We have not discussed in the highest level on the text tax. That was not something that we have anticipated so we have no discussions on that," he said.

Asked if the sin tax bill will be the first and last tax proposal for the year, Lacierda said: "For this year, the sin tax measure is in the budget in terms of fiscal policies are concerned. That's the thing we are looking at right now."

Secretary Ramon Carandang of the Presidential Communications Development and Strategic Planning Office (PCDSPO) also frowned on the tax on text proposal by IMF to generate more revenues.

"Sin taxes should be "enough for now," Carandang said.

IMF chief Christine Lagarde earlier said the government can shore up revenues if mobile phone messages are taxed.

Lagarde, who visited Manila last week, said Vice President Jejomar Binay told her telephone coverage in the Philippines has reached 112 percent given the popularity of sending text messages. "This clearly satisfies one of the two criteria for what we call a good taxation," she said.

Meanwhile, Sen. Francis Escudero balked yesterday at the proposal to increase the tax on text messaging to boost government revenues which came at the heels of the IMF chief's visit to the Philippines.

Escudero, who chairs the Senate Committee on Justice and Human Rights, said he finds it inappropriate for an institution or any foreign entities to dictate on any other government like the Philippine government "what to and not to tax."

"The IMF and its chief has no business in even suggesting that we impose tax on text. The power to tax is inherent in Congress and any external intervention is already meddling with our sovereignty," Escudero said.

Lagarde, in a meeting with Malacanang officials, had also pushed for the passage of the sin tax bill which is now pending approval at the Senate, saying it would be a "great progress for the revenue collection of the country."

At the same venue, Lagarde suggested that telecommunication services are mines for new source of taxation because of its wide base of 102 million subscriptions.

She said if the government is keen on revving up its revenues, then telecommunication would satisfy those two criterias: text messaging and calls.

But Escudero said Lagarde's suggestion is skewed, if not so unfeeling, "granting that it has a place in our economic affairs."

"I strongly oppose this foreign meddling and even the idea behind it. Ms. Lagarde is better off making suggestions to her fellow Europeans who can perhaps learn a thing or two from us," he said.

Taxation, Escudero said, should be based on the ability of taxpayers to pay.

"Text messaging is so ingrained among the lower socio-economic strata with about 90 percent of mobile phone users have pre-paid lines. Instead of providing relief for the Filipino public, this twisted idea of taxing text is an additional burden to the masses," he pointed out.

Escudero said he would block any bill proposing for higher tax on text and calls when it reaches the Senate.

On the other hand, House Speaker Feliciano Belmonte, Jr. said he is open to the proposition made by the IMF chief.

"If at all, why not set our sights on taxing luxury goods such as motor vehicles and jewelry instead of taxing text messages?" Escudero said. (With a report from Hannah L. Torregoza) (http://is.gd/krr1NN)

Manila Bulletin