Solon: Congress may suspend portions of TRAIN if rollout of social protection programs still delayed

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Quirino Rep. Dakila Cua.

Metro Manila (CNN Philippines, May 30) — Congress may opt to suspend some provisions of the tax reform law if its programs dedicated to easing the burden on the poor are not implemented by July, a solon said Wednesday.

House Ways and Means Committee Chair Rep. Dakila Cua told CNN Philippines' The Source that lawmakers' decision on the suspension of the Tax Reform Acceleration and Inclusion (TRAIN) law will depend largely on public clamor.

"I think by July, kasi we're going on recess after tomorrow — today is the last plenary day. Pagkatapos nito, babalik kami ng SONA. Tingin ko pag SONA, hindi pa na-rollout ito, galit pa rin ang taong bayan, we really have no choice...," Cua said.

[Translation: I think by July, because we are going on recess after tomorrow — today is the last plenary day. After that, we will come back for SONA. I think if the programs have not been rolled out by the SONA, and people are still angry, we really have no choice.]

Cua attributed the burden on the poor to government's slow implementation of social protection programs included in TRAIN, the first of the government's five tax reform packages.

"I cannot emphasize it enough, please, please, ating (Social Welfare) Secretary at Transport Secretary, bilisan naman po natin 'yung pag-rollout [let's fasttrack the rollout]," Cua said.

Under Section 82 of TRAIN, up to 30 percent of revenues generated under the tax reform law shall be appropriated to social mitigation measures. The programs include a social benefits card for qualified beneficiaries to avail of cash subsidy under the unconditional cash transfer (UCT) scheme and fuel vouchers for qualified holders of public utility jeepneys.

The same section outlined fare discounts for all public utility vehicles, discounted purchases from the National Food Authority up to 20 kilos of rice per month, and free skills training programs under the Technical Skills and Development Authority (TESDA). All these benefits are granted to minimum wage earners, unemployed individuals, and the poorest 50 percent of the population.

It also stated part of the 30 percent will go to programs under the Sugarcane Industry Development Act of 2015.

READ: Lower income tax, higher taxes on sugar, petroleum, tobacco products by 2018

But Cua said some of these provisions do not have Implementing Rules and Regulations (IRR). He also said the UCT program was only able to give cash to two million out of its projected 10 million families.

"Iyon po ang kinukulit namin ay sana bilisan na," he said. "They said, "We have a battery of social programs." Now where are those programs? Kasi pinangako niyo iyan sa amin, na i-rollout niyo iyan sa taumbayan."

[Translation: That's what we are continuously asking them to hasten its implementation. They said, "We have a battery of social programs." Now where are those programs? You promised that to Congress, that you will rollout these to the  public.]

Cua slammed these delays as indefensible and unfair to the public.

"We might as well suspend the tax kung matatagalan ang rollout," he added.

[Translation: We might as well suspend the tax if the rollout is delayed.]

But he said he was not in favor of suspending TRAIN in its entirety, and would at this point like to limit discussion on possibly suspending fuel excise taxes.

"Marami namang magandang benefits 'to eh. 'Yung mga less tax deductions ng ating manggagawa. So 'pag binalik natin 'yung old law, mas malaki na naman 'yung tax deductions, lalo silang mahihirapan," Cua explained.

[Translation: There are plenty of benefits to TRAIN. Workers taxes have lessened. If we return to the old law, tax deductions will increase, and people will struggle.]

The lawmaker also echoed government's stand that TRAIN is not the primary source of inflation in the country, following various price increases in basic goods.

"Let's call a spade a spade. Mag-usap tayo ng tapatan, na hindi lahat ng increase galing sa TRAIN. Meron naman talaga ibang negosyo diyan na piso lang ang taas ng cost niya, pero ang taas ng selling price niya ay limang piso. Meron naman talagang nagsasamantala, na profiteering," he said.

[Translation: Let's call a spade a spade. Let's not beat around the bush. Not all increases are due to TRAIN. There are some businesses whose cost rose one peso but would increase their selling price by five pesos. There are really some who take advantage, who are profiteering.]

Budget Secretary Benjamin Diokno said inflation attributable to TRAIN is only at 0.4 percent.

Cua urged the country's economic managers to meet at a roundtable next week to discuss TRAIN's effects on the economy, to lessen the burden on the public.

On Monday, Malacañang said the decision to suspend the tax reform law will be up to Congress. However, the Palace also warned that suspending the law would hold back other items on the country's economic agenda — particularly the administration's ₱9-billion Build, Build, Build infrastructure program.