Citing the principle of separation of powers, Sen. Francis “Chiz” Escudero said Congress may legislate a law to lower personal and corporate income taxes as part of its mandate, even without the backing of Malacañang.
While he welcomed reports that Senate President Franklin Drilon and House Speaker Feliciano Belmonte Jr. had agreed to push the income tax cuts, Escudero questioned the two congressional leaders’ position that they would have to consult the Palace regarding the proposed measures pending in both chambers of Congress.
“Why does Congress have to ask permission from the Executive department before doing its job?” Escudero asked. “If, as they claim, both the Senate President and the Speaker are in favor of tax relief, then we should pass it.”
He added: “Whatever happened to the separation of powers and independence of the three co-equal branches of government?”
Escudero said that with ample political will and determination, the passage of the tax reform bill is guaranteed, with or without the push from the Palace.
“This can be done without the consent of the Executive. Congress has just to reassert its power to legislate on taxation,” pointed out the veteran lawmaker, who has been an advocate of lower, fairer and simpler taxation system.
During his first term as senator, Escudero sponsored a measure that exempts minimum wage earners in the private and public sectors from income tax, which later became Republic Act No. 9504. The law covers the basic pay, holiday pay, overtime pay, nigh shift differential and hazard pay received by minimum wage earners.
Escudero, the frontrunner in vice presidential preference surveys, had earlier urged Malacañang to certify as urgent pending proposals to reduce income tax rates, particularly the personal income tax, which at 32 percent is the highest in Southeast Asia.
He said lowering the personal income tax will help the country’s workforce to keep up with the rising costs of essential goods and services.
The country’s finance officials, however, are not keen on backing the initiatives in the House of Representatives and the Senate in fear that these would hurt revenue collections by as much as P30 billion and that the measure may even be vetoed if passed by the legislature.
Even the Liberal Party’s presidential candidate, Mar Roxas, was against the proposal as he told the bill’s proponents to identify government programs and services that would have to be eliminated if tax reform measures would be put in place.
But Escudero explained that Malacañang’s own congressional allies had carefully studied the bills now being discussed, and had proposed various means by which the government can compensate for the estimated P30 billion in revenues the government expects to lose annually.