Taxes- “lifeblood” of government

Without taxes, the government cannot exist.

According to Atty. Arturo Acabal, BIR Assistant District Officer here, in a Kapihan forum, the proposed Value Added Tax has been proposed to improve collection performance, generate revenues and lower budget deficit by 2006.

Higher government revenues will result to a more efficient and responsive public
administration while supporting government machinery and minimize budget deficits.

Citing the advantages of VAT, Atty. Acabal said it will have no cascading effect due to its simplified and neutralized rates unlike before. “Unlike before, daghang taxes, malibog na gani ang businessmen what business to put up,” he said.

The Value Added Tax is a business tax levied on certain goods, properties and services that is being adopted in more than 70 countries worldwide. The VAT system was first introduced and implemented in 1998 under Executive Order No. 273 but covered only a limited number of goods and services.

Press Secretary Ignacio Bunye says the passage of the VAT bill will strengthen the
country’s economic footing and “give us the needed breathing space to broaden confidence, grow investments and create jobs.”

The House and Senate are expected to reach a compromise and Bunye said this will be a big step towards balancing the budget which is a major item in the 10-Point Agenda of President Gloria Macapagal-Arroyo.

Malacañang is confident the Supreme Court will uphold the legality of the value-added
tax bill, including the grant of authority to President Arroyo to raise the VAT rate to 12 percent by 2006, Press Secretary Ignacio Bunye said.