Category: taxes

Beating the TRAIN

Milwida M. Guevara

… The TRAIN corrects some of the infirmities in the tax system but adds some more.  By opening more gaps, there are various ways by which taxpayers can get ahead of the station before the TRAIN does.

1  It is better to incorporate than to run a business as an individual. The highest rate on individual taxpayers will be 35% compared to 30% if he incorporates. If he pays himself in the form of a dividend, instead of wages, his tax burden will even be lower at 10%.

2  It is even better to organize the business into a cooperative. Cooperatives remain exempt from income taxation, including the VAT — except for electric cooperatives whose exemption has been withdrawn.

3  I cannot understand the preferential treatment for pickups. The TRAIN exempts them from excise taxation. Could it be that some lawmakers are in the pickup business (pun not intended)? But, nevertheless, shift your preference for pick- ups to escape the excise tax.

4  For taxpayers going to the great beyond, postpone the date until the Implementing Rules are formulated. The transfer tax has been lowered from 20% to 6%. Plus, the deductions have been brought up to P5.0 million pesos. And, several tax reliefs are given – family homes valued at P10.0 million are exempt, and the tax can be paid by the heirs in installment within a two-year period.

5  Postpone giving donations until next year. The donor’s tax has been lowered from 20% to 6%. Now it does not make a difference if you transfer your wealth while you are alive or when you have gone to the great beyond.

6  Do not rent houses for more than P15,000 a month – otherwise the rent will be subject to VAT. Do not buy houses that are more than P2.0 million. Buy adjoining  units that are P2.0 million each to escape the VAT.  And then later, connect the houses or rebuild them to give way to a much bigger house.

7  If you must get sick, choose diabetes and hypertension over cancer. Prescription medicine for these ailments is VAT exempt.

8  If you have not converted the engine of your motor vehicle to diesel, do so now. The preferential rate for diesel remains. Compare P2.50 per liter with P7.00 on unleaded gasoline in 2018.  And stick with diesel, by 2020, the tax rate will be at P4.50 compared to P10.00 for unleaded gas.

9  There is even a bigger advantage for cars powered by LPG. The tax rate is only P1.00 and will remain at P2.00 in 2020.

10  And, start patronizing tea and coffee from Starbucks, UCC, Bo’s, Coffee Bean, among others. The sweetened beverages that are prepared in these cafes will not be subject to the excise tax. Of course, it would be better to drink mineral water, including Evian and Pellegrino.  They are not subject to excise tax.  Beverages that are sweetened by sugar from coconut are also free from tax.

11  But the biggest winners are producers of motor vehicles. The excise tax rate has been lowered on those that are priced above P600,000. They used to be subject to rates ranging from 20% to 60%.   Now the tax rate has been lowered to 10% -50%.   I wonder why.

Indeed some are more blessed than the others when it comes to public policies.

waiting for cocoy, what about sotto, calling out grace

sometime during the senate hearing on fake news by the committee on public info and mass media last wednesday, i said on my facebook wall that i found the talk refreshing, it was good to see and hear edwin lacierda, abigail valte, and manolo quezon, nakaka-miss ang intelligent discourse. (public status. 13 likes.)  we kinda took it for granted back in pre-duterte days.

not that the trio said much, except to deny that they were responsible in any way for the anonymous dilawan blog silent no more or that its webmaster was once part of pNoy’s comms team — though cocoy dayao wasn’t around to confirm the denial, so correct me if i heard wrong — and to demand that rj nieto prove his allegations, produce evidence, that mar roxas was responsible for the nasaan-ang-pangulo anti-pNoy campaign in the time of mamasapano.  nag-buckle lang si lacierda on the question of whether he is part (or something like that) of silent no more, and justifiably, because does one become a part of silent no more when one “likes” and / or shares the link of any of its blog posts on facebook?

smart of cocoy dayao not to show up.  but he should show up next time or he might have to go into hiding and then be tracked down by the cops a la ronnie dayan, ewww.  that would be so uncool.  cool would be if he came to the next hearing with bells and whistles, including a hotshot IT lawyer.  i expect that he would refuse (even in an executive session) to name his clients, i.e., the writer/s and / or owners of silent no more (and other anonymous blogs under his admin) on grounds of confidentiality.  it would be a test case on a citizen’s right to anonymity and privacy.

it would be interesting to see how sotto, and other feeling-aggrieved senators, will deal with that.  sotto, in particular, who was tagged a rapist in the controversial seven-sens post (6,600 likes, 2066 shares, 780 comments) has reason to cry LIBEL!  but then that would mean opening himself up to questions re the pepsi paloma rape case back in 1982.  under oath he would be crazy to insist that no rape happened as he has claimed in recent years.  the rape hit the front pages just 35 years ago.  marami kaming adults na noon na buhay pa ngayon, and we remember what a scandal it was, and we still marvel at how they managed to get away with it, dared brazen it out, the show must go on, eat bulaga!  no fake news that.

and because dayao was a no-show, napagtuunan tuloy ng oras at pansin at puna si mocha uson, duterte’s social media muse (5 million followers), at si rj nieto aka thinking pinoy (700K followers) who is second only to mocha when it comes to bashing dilawans and others critical of duterte, imagining scenarios based on iffy data, yet whom committee chair grace poe couldn’t praise enough for his “neutrality” and “excellent research,” never mind the times that nieto has had to issue “errata” dahil nagkamali, tao lang daw.  argh.  i’ve been blogging 10 years now and i don’t remember ever having to issue an erratum.

anyway, the next morning, on my fb newsfeed, a u.p. prof was wishing for the likes of recto, laurel, salonga and santiago in the chamber; the discourse would have been so radically different daw. (for fb friends only. 142 likes and counting.)  hmm.  miriam too?  “I lied!” was one of her favorite punchlines.

pero recto, laurel, salonga, oo naman, except what’s the point in wishing for better, based on a romanticized past, when there’s work to do confronting what is, now, and looking to the future.  roby alampay, tony la viña, and florin hilbay were outstanding.

as for senator poe, she can redeem herself by pushing through with the committee’s promise to plug legal loopholes that allow bloggers earning undeclared income from advertisements to avoid payment of taxes.  and senator nancy binay is right, tax also the so-called “influencers” promoting products and services on their social media accounts, said to be an underground billion (peso) industry.  better late than never.

shabu, semento, senado

i started writing, thinking on, this post yesterday soon after senator panfilo lacson, in aid daw of the blue ribbon committee’s hearings on shabu smuggling sa customs, delivered that privilege speech accusing ex customs chief nic faeldon and his oakwood gang of being on the take, big time.  kararating pa nga lang, may pasalubong na.

“Loud whispers in the four corners of the Bureau of Customs compound tell of a 100-million-peso ‘pasalubong’ to the newly-installed Commissioner, a quarter of which, or 25 million pesos was retained as finder’s fee by his middleman named Joel Teves.”

what, “loud whispers” lang?  no documents, no affidavits by witnesses, no hidden CCTV that prove/show that money illegally changed hands?  interesting.  a former top cop playing like bato’s cops: “shoot” now, explain later.  but not too surprising, given senator ping’s long colorful history.  twice he was the accused in very high-profile cases — the kuratong baleleng shoot-out / rub-out in 1995 and the bubby dacer – alex corbito murders in 2000.

lacson pleaded innocent in both cases and in due time each was dismissed. kuratong baleleng was more easily won.  dacer-corbito was not; ping had to run for it, just before he was charged in court; he was a fugitive for 15 months, there was an arrest order out for him, even the interpol was on the lookout.  umuwi lang siya after the supreme court dismissed the case, affirming the court of appeals’ earlier ruling that the principal witness was neither credible nor trustworthy.  same witness recanted his testimony sometime in 2015.

i’ve always believed that lacson is one very powerful man.  back in the days of erap, when he was PAOCTF chief, there was a lot of talk that he had dossiers on everyone, which inspired fear.  he could be truly innocent of the dacer-corbito murders but i have no doubt that he knows more about these murders than he has ever let on, and that’s like being complicit in protecting the guilty, isn’t it?

but to get back to yesterday when he lashed out at faeldon.  kahit pa sabihin, for the sake of argument, na guilty as charged si faeldon, nagulat ako at the viciousness of lacson’s attack.  guilty until proven innocent.  bakit siya galit na galit kay faeldon? pareho sila ni trillanes, actually.  what do they know about faeldon that makes them so mad at him (or vice versa), but which the president either does not mind or does not know?  is it for PMA’er’s ears only?

this morning faeldon struck back at lacson with a vengeance, wondering what lacson’s motive was for accusing soldiers whom lacson himself knows daw are innocent of corruption.  and then he went on to make kuwento about a cement importer by the name of panfilo lacson jr. whose small company has been bringing in shiploads of cement, tone-toneladang semento, na misdeclared, undervalued (at $8/metric ton) by some 50 percent of market price.  106M pesos worth of cement in 3 shipments over 3 days in july 2016.  nakaka-67 shipments na daw by now.  and like tish, faeldon has documents.

tanong ni faeldon: alam mo ba ito, senator lacson?  kasi kung hindi, kung hindi mo alam ang ginagawa ng anak mo sa customs, then wala kang alam tungkol sa customs.

sagot ni lacson: it’s a big big lie …  i am not my son’s keeper … faeldon’s $16 for cement is too high.

also the senator said that he would not have made yesterday’s exposé re faeldon if he himself were involved in customs corruption in any way.  and anyway why did it take faeldon so long to make sumbong?

hmm.  it is not beyond imagination that lacson made the exposé — even if he himself was not beyond reproach — out of hubris, over-confidence, thinking no one would dare mess with him, or that faeldon in particular would not dare challenge him.  just as it’s perfectly understandable that faeldon was in no hurry to tangle with the senator, as who would be? until he had his documents in order.  and if he is NOT on the take, then it makes sense that faeldon would hit back at the senator with everything he’s got just about now.

it’s not quite as hateful or scandalous as the shabu smuggling — after all, di naman illegal substance ang semento — but undervaluation in aid of paying less in taxes is technical smuggling, a crime that cheats government of millions, maybe billions, in revenue, and which is punishable with fines and imprisonment.

hindi bale sana kung dahil nakamura sa customs ay mas mura nilang ibinebenta ang semento sa mercado.  asa pa.

meanwhile, senate prez pimentel and senators drilon and aquino were quick to express support for their colleague.

PIMENTEL. “We have to make sure that this is not pang lihis lang ng isyu. And Faeldon should state everything he knows about everyone involved in suspicious activities in Customs and not only concentrate his return fire on the person who exposed the tara system in BOC.”

DRILON. “I have full faith in the uprightness of Sen. Lacson and his family. Without any evidence other than Faeldon’s allegation, I will oppose any investigation. It will be a waste of time and will simply be used as a venue for character assassination.”

AQUINO said he is confident Lacson could defend himself against the allegations of Faeldon that his son’s company is the “number one cement smuggler in the country.”

if not for faeldon, we wouldn’t now know that senator lacson’s son is a  customs player pala.  nakakapagpaisip, di ba?  sino pa kaya sa mga senador ang may anak, kapatid, pamangkin, pinsan, at / o inaanak na customs players din.  imposible naman na si lacson lang.  time to circle the wagons indeed.