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Senators disagree on scrapping of E-Vat
July 10, 2008 By Carmela fonbuena Administration Senator Edgardo Angara today echoed Malacañang’s position on the calls to scrap the expanded value added tax (E-VAT). “If you remove the E-VAT on oil, government will lose its lifeline for subsidies on rice and electricity. Government is faced with a difficult choice. Hence it should seriously study the effects of repealing the E-VAT on oil,” he said in a statement. But opposition Senator Manuel Roxas II disagreed. Calling for the scrapping of E-VAT, Roxas said it is not the only means to fund government’s pro-poor programs to help the poor cope with the record-high inflation. “Are we relying solely on VAT on oil to implement these pro-poor programs, at the same time, to cut the deficit? Are they telling us that this VAT on oil is the be-all, end-all of our collection system?” Roxas said. Instead of E-VAT, Roxas said the government should collect taxes efficiently, review its spending program, and re-channel funds from programs “useless to the people” to programs aimed towards immediate relief and ensuring food security. Instead of immediately scrapping E-VAT on oil, Angara said the Philippines should seek ways to cushion the country from the impact of the oil price hike by exploring alternative energy sources. “There is a need now more than ever to explore our alternative sources of fuel and energy. Solar, geothermal, hydro and wind energy are proven power technologies, for which we have great and untapped potential,” he said. “I reject that the government is helpless. I reject that the government cannot do anything else aside from what’s business-as-usual. The times call for the government to tighten its own belt, not continue tightening the noose on an already choking economy,” he added. He proposed four ways to review the budget: 1. Suspending big-ticket capital expenditures (new construction) because these have relatively higher leakages, longer gestation periods due to tedious bidding processes, and lower employment generation. “It’s better to accelerate maintenance or rehabilitation of existing projects because these are labor-intensive, so we’re sure the money goes to workers, not to foreign consultants.” 2. On accelerating maintenance or rehabilitation spending, focusing could be on repairing and rehabilitating existing irrigation systems to improve farm productivity. For land areas which don’t have existing irrigation systems, small water impounding systems should be preferred over big-ticket irrigation projects which could take too long and will have little immediate effect on jobs. 3. Suspending expenditures of the road users tax, where there is little accountability and benefit, and realigning it to food-for-work or -school programs. 4. Realigning the Kilos Asenso Fund and other “pork barrel-type spending” towards augmenting conditional cash transfer programs. 
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Angara: Use alternative energy
Angara cited the G8’s call for governments to provide safety net support for its poor population by boosting support for food assistance in light of soaring food and fuel prices. It was the top agenda at the recent summit of leaders from G8 nations— Britain , Canada , France , Germany , Italy , Japan , Russia and the United States .
Roxas: Review the budget
“They make it appear that the government’s efficacy depends on oil VAT, and that they’re practically helpless without it. At the same time, other means to ensure funds for government programs have not been maximized,” Roxas said.
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