For Bureau of Internal Revenue officer Abolhasan Balindong, the new Tax Reform for Acceleration and Inclusion (TRAIN) or Republic Act No. 10963 is a ‘long-term investment’, making the Filipinos feel the benefits not right away, but sooner or later.
“As Filipinos, gusto nating maramdaman [agad] ‘yung benefits. But ‘yung TRAIN Law is more of a long-term investment. The revenues that will be generated will be used to finance the ‘Build, Build, Build Program’ of the present administration,” Balindong said in a TRAIN Law seminar organized by Ateneo Human Resource Management Society (AHRMS), September 5.
“That will be used in constructing roads… which will result to creation of more jobs… mas maraming construction, mas maraming jobs that will be created,” he added.
Balindong stressed the importance of taxes in taking care of the welfare of the citizens, as they fund public works that can be used by the people.
“In running the state, the government has to generate revenues. Bulk of the revenues come to the taxes that the taxpayers pay. The taxes are used by the government to pay the necessary expenses, and promoting the welfare of the citizens, just like the construction of bridges, public hospitals, the salaries of government employees.
“Though we cannot feel instantly the benefits of the new tax law, sooner or later, we will benefit from the taxes that we pay, not only us but our children as well,” Balindong told Atenews.
He also emphasized that TRAIN Law is not the main cause of the price increase of basic commodities such as fuel and the higher inflation rate.
“Because of the price increase of some basic commodities, they put the blame on TRAIN. But in fact, it is not really the TRAIN Law that causes the price increase of some basic commodities, like fuel.
“But if you try to look at the TRAIN Law, the gasoline actually is subject to VAT and at the same time excise tax. But it is not only the TRAIN Law that causes the increase of the price of the fuel but the Carbon Market Policy in the world from Europe as well.
“The effect of the TRAIN Law to the inflation rate is only four percent. There are other factors. It’s not only the TRAIN Law,” he said.
Balindong gave an overview of the differences in personal income tax computation in TRAIN Law as compared to the National Internal Revenue Code (NIRC) of 1997.
The revised tax scheme which was implemented last January excluded tax in annual earners of P250,000 below.
The graduated rate for earners above P250,000 increased as compared to the previous tax scheme.