The Trade Union Congress of the Philippines (TUCP) calls on the government to address the increasing prices of basic goods like rice which directly affect the poor and even the lower middle class. In August 2017, inflation rate was at 3.1%. On top of increasing costs of staple foods, the prices of diesel and gasoline went up 40 centavos to one peso per liter last month while Meralco up its power rates to 0.86 centavo per kwh this September. The looming passage of the Administration’s Tax Reform for Acceleration and Inclusion (TRAIN) that also aims to impose an excise tax of P7/liter for gasoline and P3/liter for diesel and other petroleum products will certainly further worsen inflation rates.
“We ask Congress to step back from the brink on push for excise tax on petroleum. These are clear and present danger issues that already project increased inflationary pressures which will exponentially drive the prices of basic goods and services up. We strongly urge Congress to heed the warning signs that the cost pressures on the poor and low-income groups unaddressed by wage increases are setting the stage for increased political volatility,” said Luis Corral, TUCP Vice President.
The “build, build, build” paradigm requires that tax revenues be ensured to finance the new infrastructure but TUCP believes the sequencing of tax reform should begin first with tax administration reform addressing yearly shortfalls in Customs and BIR first. The insistence on excise taxes on petroleum will push those recently raised above the poverty level, again back to the poor, increasing social and economic inequality.
“The current incomes of ordinary workers are not enough to maintain even just a decent existence much less to achieve a comfortable life while the top 1% of Filipino families, including the 50 richest Filipinos who continue to earn ever higher incomes and greater wealth from the continuous expansion of the country’s economy. This is not inclusive development but a glaring social injustice”, said TUCP Spokesperson Vicente Camilon Jr.
The TUCP recommends several state interventions to stem the tide of increasing inequality in the Philippines. First, it pushes for substantial wage increases nationwide. The national labor center urges the Regional Tripartite Wages and Productivity Boards (RTWPBs) particularly in the National Capital Region (NCR) to immediately act on the wage petitions filed by its affiliates Associated Labor Unions (ALU) and Philippine Trade and General Workers Organization (PTGWO). ALU and PTGWO filed with the RTWPB-NCR for P184 and P175 wage increase, respectively.
Second, the labor center is backing for progressive taxation. The TUCP supports the proposed reforms on personal income tax (PIT) which aim to exempt those employees earning P250,000 per year from income tax payments and the reduction of income taxes for different levels of income starting 2018, and for further rates reduction starting 2021. This objective under the proposed TRAIN is supported by the labor center based on the principle that those who earn more must pay more income taxes to the government. The rich must be heavily taxed as they are the ones who benefited much from economic growth.
Third, the TUCP wants the government to strengthen and expand social protection and social services for all the poor and vulnerable sectors of society particularly to cover their medical, shelter and educational needs and for other emergencies such as unemployment insurance. And fourth, the government must protect and promote the rights of workers to security of tenure, to organize and to collectively bargain with their employers. Organized workers have a better chance to demand a just share from productivity gains of their companies and industries which could lead to higher incomes and more benefits for workers and their families.
“Today, fewer and fewer number of people gets bigger and bigger share of national income and wealth. This is one of the biggest political problems of our time. The “Ambisyon Natin 2040” which is our vision where there will be no more poverty in the Philippines by 2040 will just be another pipe dream if the government will not deliberately address the problem of rising inequality in the country”, Camilon added.
For inquiries please contact:
Vicente C. Camilon Jr.
TUCP Assistant General Secretary and Spokesperson