Consumers Domain
By Ian Seruelo

Burden and more burden

“The marvel of all history is the patience with which men and women submit to burdens unnecessarily laid upon them by their governments.”

—William H. Borah

In the coming days, we are expecting that the Supreme Court will lift the hold on the implementation of the new VAT law. When this happens, the government is set to implement the said measure that will cause additional increases in power rates and the price of petroleum products, among the other goods and services that will be covered by the expansion of the Value-Added-Tax.

Even with the current surge in the price of oil in the world market, Malacañang immediately shot down a proposal to postpone the implementation of the VAT that will be applied to oil products. According to Gloria Arroyo, her administration will choose “the long-term gain of high taxes over the short-term pain of skyrocketing fuel prices and power rates”.

I really cannot understand this statement. I can't seem to make sense out of it. Can you? How could Gloria say that higher taxes are a long-term gain for the population, for us taxpayers? Further, how could she say that the skyrocketing of fuel prices and power rates are only short-term pain?!

Well, here is good old Gloria once again, simply trying to improve the economy and the lives of the Filipinos in paper that can be captured by some macroeconomic indicators, which when tossed to the media and the international community will seem to paint a beautiful picture of our economy. Remember what this column previously said about economists being painters? (I suggested banning them from holding paintbrushes, as they tend to paint only in bright and rosy colors.

Imagine this: higher taxes, spiraling cost of power and oil products… Add to that that the increase on health and other professional services as this will be covered by the new VAT… Add to that several more rounds of fare increases… Add to that the resulting increases in the prices of prime commodities pushed higher by the new tax measure, pushed higher by the increase of electricity inputs into these products, pushed even higher by the increasing cost of transporting these goods…

Now can you see any long-term gain in that picture? Can you even imagine an iota of benefit from that scenario? Well, unless you are a sado-masochist who derives more pleasure and satisfaction from more pain and greater suffering…

Yes, all I can see in the short run and the long run are all pain and suffering. We have been paying high taxes in return for pitiful services from this government for so long that we even seem to forget that that is the role of the government in the first place – to provide for services, social and economic. We have been paying very expensive power and petroleum rates for so long a time, we even get so used to witnessing new round of increase every time our eyes blink.

Burden, burden and increasing burden. And want to hear more about what Gloria said: "We shall put the welfare of the average Filipino first on this issue, even as we make tough decisions to keep the country strong and resilient."

Can you believe that? What welfare is Gloria talking about? The logic of this statement from Malacañang is this: more taxes means more revenues for government, more revenues means less budget deficit and additional resources for debt payments, less deficit and religious debt payments will mean favorable economic indicator, favorable economic indicator will mean good credit rating, good credit rating means more access to loans!

But yes, Malacañang will also say that more resources will mean more spending for housing, health care, education, more jobs, and all the ek-ek… But hey, lets cut that bullshit! We know it doesn't work that way. Years and years have gone by and taxpayers money are mainly siphoned to debt servicing, to kickbacks and tax leakages. A quick look at the government's annual historical budget and spending will demolish this line of reasoning.

And yes, Gloria will also assert that favorable economic indicator will mean more investment and more investment will mean more jobs. For the past decades, the only big investments we attract are mostly the portfolio types that magically vanish every time there's a kink in the country's politics and economy. Jobs? Tell that to the millions who are unemployed and the millions more of our OFWs who are all tired of hearing those job-creation so so…

But I know one thing that can ease the suffering of this nation (albeit just a little), that maybe could give some hope for this country, calm the markets, bring in more investment maybe – How about kicking out that fake president out of Malacañang first? Then maybe we can start to restructure this system and reform the skewed policies of this government. How about that?

(For comments and reactions send SMS to 0919-348-6337 or email to ianseruelo@yahoo.com.)