The Economic Vision and Platform of Noynoy Aquino
January 21st, 2010 by cocoyThis is how change begins. The air is bristling with possibilities. Can you feel it energized by Hope and Faith in our unified Future? Before a room of 800 senior executives that make up the Makati Business Club, the Management Association of the Philippines, the Financial Executives Institute of the Philippines and the diplomatic corps, was Senator Benigno S. Aquino III delivering his first policy speech and when it was over: a standing ovation.
Change is off to a great start.
This is what Noynoy Aquino envisions for the Philippines: a country where taxes are lower and where markets are free to encourage entrepreneurs and enterprises to invest for jobs to be created.
Is that possible?
“As of November 2009,” Senator Aquino noted, “the deficit of the national government already reached PHP272.5B, or 4.1% of GDP.”
These are facts:
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- BIR Collection fell 5.5%.
- Bureau of Customs Collection declined 16.6%.
These are estimates lost to corruption:
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- 280 Billion Pesos in 2009.
- Over 1 Trillion pesos between 2002 and 2009.
“For the first time in recent history,” Noynoy Aquino said, “that absolute revenue declined.”
The atmosphere seems dismal. The task before us daunting and yet amidst these truths, an Aquino administration is confident that it will avoid imposing higher taxes or introduce new taxes.
Okay, that sounds crazy doesn’t it? Tax revenues have declined, and Aquino wants to lower taxes. How is he going to achieve all that?
[Read the full post at blogwatch.ph]
January 21, 2010 at 11:36 pm
Those are just icing on the cake. If he remains honest and clean and a good leader, won’t tolerate graft and corruption and actually reduced it, won’t allow his relatives to steal, dispense with justice fairly and effectively, I’ll be satisfied. That should be a good start for the succeeding administrations to emulate. After all, six years is a short time for a good president to do so much, and it’s about time we start cleaning these present mess we’re in.
But first, he should win the election, and must win it convincingly. It’s up to every one of us.
January 21, 2010 at 11:49 pm
‘Before a room of 800 senior executives that make up the Makati Business Club, the Management Association of the Philippines, the Financial Executives Institute of the Philippines and the diplomatic corps, was Senator Benigno S. Aquino III delivering his first policy speech and when it was over: a standing ovation.’
@ Cocoy, you Full of Idealism,
Let me fathom what’s going on those executives’ minds: Hhhmmm, here’s a tenderfoot we could easily tame. Happy days are here again!
January 21, 2010 at 11:53 pm
well lets see. at one point in my life i was in that same room. haha. i’d know how they think ;)
January 22, 2010 at 10:33 am
NoyNoy said a lot of things in the speech including (to be expected) broadsides against the previous administration. In particular, he complained the impediments that “executive privilege” creates with regards congressional oversight. [Note: he did not say that if elected he will not allow any of his cabinet members to refuse to appear before a request from a congressional committee.]
NoyNoy mentioned the P200-plus-billion a year “…lost to corruption” and left alone the impression that his administration will use said recovered-largesse for tax rate reduction. NoyNoy forgot to mention what percent of the P200billion a year he expects to recover. Had he said 10% or 15%, I would know his economic advisers are setting him straight. Had NoyNoy said 50% and higher, then “Wizard of Oz” wonderland.
NoyNoy mentioned almost in the same breath the quality of the books used in public schools (I saw “500 mistakes per book”) and graft/corruption. Now, my reckoning (folks may disagree)… money is made from NOT delivering the books, not from printing books with errors, so I am led to believe complaints about “500 mistakes per book” can be assigned to lazy PhD’s and Master-degree holders and less to corruption.
But I said too much while NoyNoy did not mention GDP, GINI, or the United Nations Millenium Development Goals for poverty reduction. Folks should read the speech to arrive at a more solid perception of the quality of NoyNoy’s economic team, his speechwriters, and what exactly NoyNoy had said. [For all you know, I am commenting on a wrong speech.] But in the speech I read, yes, NoyNoy followed a standard rule of public speaking by clearly making a request that his audience vote for him.
January 22, 2010 at 10:46 am
“…500 mistakes
per bookper series”January 22, 2010 at 11:58 pm
I think that NoyNoy should not even have mentioned to Makati Business Club the issues of poverty, increasing population, unplanned pregnancies, illiteracy. Wrong audience – one. He proposed no solutions — two.
does he have separate channels of communication to classes D and E? What does NoyNoy say about anti-poverty or anti-illiteracy programs?
January 21, 2010 at 11:59 pm
“This is what Noynoy Aquino envisions for the Philippines: a country where taxes are lower and where markets are free to encourage entrepreneurs and enterprises to invest for jobs to be created.”
This is what I call delusional, anti-masa and pa-appeal to the middle class. Lower taxes with all the developmental problems we have. We barely have enough infrastructure to maintain our population let alone advance.
Noynoy appeals to me because of his lack of criminal history. Whoever works for Noynoy, just be serious and realistic, OK. None of this lower taxes BS.
January 22, 2010 at 12:02 am
We need more tax revenues, the rich and middle class should feel connected to the poor and taxes is the best way to go since this has a national scope and is forced on all. Charity simply doesn’t work when you’re a democracy. It puts the charity giver above the recipients and is limited to moods and personal interests.
January 22, 2010 at 12:14 am
Read it again Brian. Philippine tax rates are high already, compared to other countries. The problem is in the collection. I believe the argument being put forward is, if the rate of collection is improved, it might allow for a lower tax rate across the board. When you punish the middle class, you’re alienating the majority of the tax paying citizens of the country, as well as hampering their efforts to better themselves. The taxes ARE THERE ALREADY, they just need to be collected better.
January 22, 2010 at 12:20 am
It’s tax reform you’re saying and not less taxes.
And how do you exactly propose to raise tax revenues “that’s already there?”
January 22, 2010 at 12:24 am
Collection RATE. The potential revenue lost to ‘fixers’, evasion, etc.
January 22, 2010 at 12:53 am
moneyV: one can actually conclude Pilipinas tax rate is average or even below-average.
Pilipinas income tax rate is reported as 5-32%, VAT at 0/7/15%.
Tunisia has same income tax 0-35%; higher VAT 6/12/18%.
UK is 0-40%; VAT is 0/15/17. Sweden is 28.9%-59%; vat is 25%. Poland is 18-32%; VAT at 22%. Portugal is 10.5%-40%; VAT at 20%.
Come on, Pinas should find oil!! Saudi Arabia 2.5%; VAT is zero.
January 22, 2010 at 12:57 am
I agree with what I think BrianB is saying.
Pilipinas needs more tax revenue in order to provide bare-bones development spending (infrastructure, schools, etc). Definitely tax collection be improved. The additional money from improved tax collection should be put into development spending, not into reducing income tax rates.
January 22, 2010 at 8:27 am
Noynoy does not need to lower taxes because that means lowering VAT and payroll tax deductions which are the principal source of revenue of the government. What Noynoy should do is collect from the tax cheats – the businessman, who understates corporate income, the professional, who does not report his professional fees; the property seller, who undervalues his selling price; the importer, who misdeclare his import; the smuggler who pays no import duties, etc. etc. These cheats have no fear because they know that any tax investigation or assessment can be fixed with the BIR examiner, whoever sits as Commissioner. He should also do a quick check of pending tax cases – e.g., what used to be a winning billion peso tax case against Lucio Tan’s cigarette empire is now on the verge of being dismissed because a truckload of documentary evidence is reportedly missing. Also, he should look into the cases of fraudulent tax credit certificates that some oil companies got themselves richer at the expense of the government. Sadly, the country’s system of taxation is being used by tax implementors to skim from what rightfully should go to government coffers. This is what Noynoy should attack and if he succeeds he’ll be the first ever president to cure this bureucratic cancer.
January 22, 2010 at 9:55 am
macapili, please read text of speech or the full blog post. it was explained very well. thanksl.
January 22, 2010 at 1:14 am
I have not seen a long time the movie:”Somewhere Over the Rainbow”.
To paint such good times as we elect Noynoy Aquino is ridiculous.
Hope sometimes turns into World of Reality: DISAPPOINTMENTS. More of
the same. Sorry, I dont buy what you are selling.
January 22, 2010 at 9:56 am
what exactly are you disagreeing with? what specific thing did he say that you didn’t like?
January 23, 2010 at 2:20 am
I am only waking up people of what will be. I like everybody.
But to delude people of coming good times because we elect
some kind of President with a good name is ABSURD.
January 22, 2010 at 1:36 am
Lower tax rates will encourage people with money to go to business. More busineess, more jobs. More people with jobs, more sources of taxes.
Compare the tax when money is sitting in a bank account and the corporate tax. I’ll put my money on the one with the lower tax.
January 22, 2010 at 3:16 am
These will be the same old businesses of restos, parlors, spas, boutiques, etc. Di bali nalang. Someone should do a study on how these replicant businesses are really beneficial to the country.
January 22, 2010 at 1:38 am
The Movie title should be: “The Wizard of Oz”. “Somewhere Over the Rainbow”; is the title song. Sang by the late Judy Garland.
January 22, 2010 at 1:40 am
The Movie title should be: “The Wizard of Oz”. “Somewhere Over the Rainbow” is the title song.
January 22, 2010 at 7:13 am
mariano: the 20%-population who live a dollar a day do not watch Wizard of Oz, but I suspect Erap-para-sa-mahirap campaign will chat with them in next weeks. Lowered tax rates benefit people earning P300,000 a year or more, whoopeee!!! The 20% pobreng-pobre-na-talaga, whatcha think happens to them with NoyNoy’s proposal?
January 23, 2010 at 3:09 am
What a way to use thew POOR to get elected as President.
It stinks like the garbage dumps that are near their houses.
January 22, 2010 at 2:15 am
Can someone EXPLAIN why i need to go to Blogwatch.com to READ THE FRICKING FULL ARTICLE??
Are there TWO websites now?
January 22, 2010 at 3:34 am
Coy, as suggested, please stop posting snippets here at FV.
January 22, 2010 at 9:57 am
noted. people still comment here when the article was posted somewhere else. the discussion continues.
January 22, 2010 at 10:12 am
i hope you trust me enough to know what i’m doing.
January 22, 2010 at 10:03 am
Standing agreement so that information is spread as far and wide as possible. The intent is keep the discussion flowing across the web.
The intent has always been to keep the discussion going.
i write all election-related post for them, i post snippets here.
if it really means that much to everybody, i will cease writing any election-related post for FV.
sound off if that is the rough consensus.
Nick, if you are reading this: drop me an email on your thoughts.
January 22, 2010 at 5:09 pm
cocoy,
It is true that oneday, everyone, including ourselves learn that, to reach a true conclusion, one must start with true premise and use valid logic. With the greatest pursuit in education, we strive, and achieved for the purpose of a lesson. Inauspiciously is largely forgotten later in life. Most lack the intelligence, interest, or courage to apply the lesson rigorously. To some or many breaks or bend the rules to further their own agendas or careers. For some, can only muster the will to follow the rules in some part or in some cases. Usually great, is the person who muster the lesson. Coy, I for one, truly admire your passion.
My opinion. Increasing TAXES actually deflate economics!
January 22, 2010 at 5:54 pm
mario, haha. we are of the same mind. re: taxes
January 23, 2010 at 8:56 am
mario: tax-collection is obtaining the money to build more roads and airports and yes, tax-collection is Robin Hood — getting money from the middle class-and-higher to provide subsidies for the illiterates unemployed, their children, and their children’s children. What some folks believe is that the bulk of the tax money that go to the class-D/class-E do not have the multiplier effect to grow economies, while tax-money that goes to road-construction does, a thought that I hope NoyNoy nor any of the presidentiables believe, but you never know.
January 25, 2010 at 11:55 am
Up n grad,
I am sure you understand the concept of “GDP” (this is the main economic mover for all nation) If Philippines can start generating its own “Gross Domestic Product,” it will and forever sustain its economy. Base on their self efficient on products/services it generates. If enough GDP is created, the business industries can move these products abroad to sustain the need of the Phillipines economy.
With higher GDP you are able to keep local businesses and employ more local people in the process. Hopefully, in the future there will be no need for “OFW” (this is what ruining our Philippines economy, for now…) In reality, someone in the government are making big money off of these “Overseas Filipino Workers.” Therefore, the taxes it generate, can be usefull for the public, rather than government leeching off the GDP, that OFW’s generate. Which is a high percent of GDP it gives back to our nation.
A good example. In the United States alone, practically all, Asian communities consume rice products. If only Filipino entrepreneur can supply the need/demand for the rice consumers on this wealthy nation. Just think, how much GDP it will generate. This will also, help the public on taxes it generates.
And, who’s teaching our neighboring Asian countries, to harvest and grow rice?
And, who are selling these goods to other nations?
Not Filipinos, it’s our neighboring countries. Go figure!
• Higher GDP = better nation
• More work for the local people
• Creates taxes for the public
• Yields better Economy
January 22, 2010 at 4:00 am
Cocoy,
Based on the video clip I saw, I think you missed the context entirely. My takeaway: Mr. Aquino said he wants to impose tighter discipline on tax collections so that those now paying little or no taxes are properly taxed. Given the proper payments by those now sliding past the radar, it will be possible to reduce taxes that now overly penalize those who DO pay taxes.
It makes sense to me, as I know property taxes are assessed and paid below going rates, and the non-reporting business market is huge.
You are arguing for the status quo on tax collecting???
Joe
January 22, 2010 at 11:42 am
A large chunk of potential tax collections for Treasury are NOT sliding past the radar. BIR sees them, BIR goes to court collect, BIR loses the court case.
January 22, 2010 at 12:03 pm
i suppose you’ve never had to run your own business and have your accountant tell you: “Sir, even if we report right, the BIR will still find holes and penalize us”.
January 22, 2010 at 2:02 pm
I think your accountant was saying that he can prepare accurate and compliant-to-the-code financial statements; dealing with BIR’s loosey-goosey interpretation of tax codes was not his paygrade.
Some action-choices I can think of — (i) call a friend; (ii) game it, under-report and negotiate; (iii) there is only one truth and let the chips fall where it may.
January 23, 2010 at 12:38 pm
UP n grad, yep there are action choices that you can take but playing under the table is far easier than fighting it. locking yourself in endless litigation doesn’t help business. i know— that’s not an excuse but you can see how the cycle is perpetuated. who would you go to to complain and not get sidetracked?
January 22, 2010 at 12:02 pm
Joe,
I reviewed the video, just in case i missed anything. I stand by what i’ve written. I understood clearly what he said. Senator Aquino was *very* clear: Lower tax rates for ALL, rather than Tax Breaks for some.
January 24, 2010 at 12:58 am
How about Noynoy Aquino’s position on the squatters living
around those Garbage Dumps? They are more important than
the tax issues. These are living and breathing marginalized
people. Trapped in cycles of poverty.
January 22, 2010 at 5:22 am
i like it. keep posting here, if u wish.
January 22, 2010 at 5:29 am
Improve tax collection by privatizing the collection part. Taxpayers can still submit their ITRs to the BIR but send any payments directly to the government bank account.
January 22, 2010 at 12:05 pm
the small guys don’t have a problem because the BIR already withholds taxes on payday and the company reports it to the BIR as deducted. It is the huge taxpayer and business and industry that is the problem.
January 22, 2010 at 10:01 pm
I’m actually thinking of corporate taxpayers not the employees. If corporate taxpayers pay through the bank, they will get a receipt from the bank not BIR. There is a syndicate that helps corporate taxpayers by asking them to issue 2 checks. One check with the full amount and the other has the ‘negotiated’ amount. Guess which check gets cleared.
January 22, 2010 at 10:32 pm
supremo
the way i understand it the paperwork that needs to be filed is checked by a bir agent who makes sures the company’s accountant filed it right. paying isn’t the tough part, it is putting the right set of data on the form. again, my understanding of the thing is that even before the right document gets filed, the accountant has already talked to the agent who lets him know what to remove, what to include and how much turning a blind eye on is.
the boss then signs the document.
January 22, 2010 at 1:12 pm
The middle class must demand and concentrate on substance such as decreasing unemployment rate and improving national security. Entrepreneurship can be in supply in this country with training and education but employment generated can also be unstable because of the lack of security and competent police force (Financial aids and government support are lacking). In addition,People still transact in cash and BIR people can also be corrupt.
In my observation, your leaders do not care for the people. The Philippines is somewhat demoralized when I was there. Cities and the provinces are dirty and filthy. There’s no understanding of what quality of life is all about. Majority is just too poor, illiterate, ignorant, sensitive, emotional and angry. There are no awareness programs created by governments nor solid solution. The problems are all man made- the result of poor governance in office. Even the barangay kapitan cannot generate local livelihood project and clean up the environment. Mayors are focused on projects and its kickbacks. Congressmen lack the skills except an agent of corruption- buying the people’s vote.
January 22, 2010 at 3:36 pm
yep. exactly. we need to move forward with that. Sen. Aquino mentioned that in his speech. He said:
“To my mind, the crucial, lacking element in all these is a government committed to a transformation: from a society overwhelmingly poor to one overwhelmingly middle class.In every developed, progressive, prosperous democracy, it is the middle class that is the biggest class. Government, for one, has failed to make the conceptual leap from patronage to development. Efforts at feeding the hungry, clothing the naked, providing basic care to the sick, and offering a quality education aren’t only the people’s rights; they are the essential tools for individual self-improvement.”
January 22, 2010 at 4:56 pm
so coy, Noynoy ka ba? you, my friends, my uncle and my nieces back home will get along. my politics friends are for GIBO. sige na nga.. noynoy na rin ako.. hehe
January 22, 2010 at 8:27 pm
salawasaw, ehe, este, salawahan!
January 22, 2010 at 5:35 pm
i found gibo to be lacking. as i mentioned in a separate piece, “is gibo teodoro ready to lead?”
I think it is fairly obvious by now that yes, my color for 2010 is yellow.
January 26, 2010 at 9:29 am
bert. ikaw ha… pastilan uy. mag jagajaga man lagi kah..
honestly, i no longer have a candidate.hopefully the next day, i will come up with a new one.. lol
January 22, 2010 at 2:32 pm
Cocoy is doing ok. keep it up, ‘coy!
January 22, 2010 at 4:20 pm
Actually, coy is doing an excellent work. One more mouse-click to another link don’t bother me a bit. Hell, using these systems at work, Pro-Engineer and AutoCAD. Shit! I must click gazillions times by the end of the day!
So again, one link away is non-problematic at all.
January 22, 2010 at 6:25 pm
i’ve decided not to post article snippets here on FV.
if you wish to read my thoughts on the election, please visit blogwatch
we also have an iphonepinas site where i will be writing reviews, new apps and such for iphone and ipod touch users.
In a few weeks, we will launch a tech channel blog where we will talk about photography, how tos and lifehacks, gadget reviews, technology features and commentaries. if you guys are interested in that i will make an announcement on my twitter when we will officially launch.
What FV readers can expect to find in this blog from me will be writing about issues that are not related to the election like Mendiola Massacre Facts, which i just posted.
Don’t expect me to write here weekly from now on or regularly for that matter.
Sorry, i’m not a fast writer and FV is just a hobby for me. I cannot keep up with the torrent. you will see me helping moderate comments and the such and participating on these threads from time to time.
Sorry, something has to give way and this is it.
January 22, 2010 at 8:35 pm
Hey, cocoy, that’s not fair, two nays, and three ayes, we won! Why should we lose you and your good ideas about politics? Not fair.
January 22, 2010 at 9:06 pm
good of you to say so.
you can read my stuff on blogwatch. i post there at least once a week.
sorry, too much work. haha. got a lot of things on my plate. i will try to post here at least once a month. i enjoyed writing that mendiola thing. there will be more things like that but i can’t guarantee regularity. it takes me hours, sometimes days to write and it isn’t fair for FV to get only snippets.
January 23, 2010 at 12:19 pm
No mention at all of the importance of science and technology in economic development! Now how can intelligent and competitive change can begin without S&T?
January 23, 2010 at 12:39 pm
yep. exactly. writing a post on internet freedom and how it becomes part of economic development for example.
January 24, 2010 at 12:46 am
I think Noynoy’s doing good that he’s addressing the tax shrinkage. That 20% Corporate Tax has been damaging and may be a devious opportunity for business owners to increase prices and lower wages. Lowering the tax (accompanied by a higher minimum wage which Noynoy said he will increase) will make the relationships of owners and employees better since the tax which goes to the government is redirected directly to the people and can be more concretely felt by them.
A good idea is that there be a system that adjusts the tax rate to the tax collection. Like how the BSP adjusts its liquidity reserves for the banks. It’s obviously unfair to the people if the government adjusts taxes yet cannot adjust its tax collection.
Personally I don’t mind the snippets since its still in the spirit of FV. Reposting is a common practice on the net. I feel so sorry to nashman I hope you didn’t strain your finger clicking on the link. :)
January 26, 2010 at 9:24 am
Edward, exactly. as per snippets, i still stand by the decision not to put snippets on filipino voices. I apologize if it sounds too petty or shallow or inconvenient. i encourage you and everyone to visit blogwatch.ph, as i regularly post there now. My latest post being, the disappointing state of discourse in the philippines. hope to see everyone there.
January 25, 2010 at 8:22 pm
Its ironic for noynoy to say “No New Taxes” and “better tax collection” when he’s talking in front of the biggest tax evaders on the country.