Why are people on billionaires’ list not taxed more?–senator

CITING the so-called “billionaires’ list” that comes out annually, Senator Sherwin T. Gatchalian is wondering why many of the names there are not on the list of top taxpayers.

Commenting on proposals to tax the rich more—some quarters want to introduce a so-called “wealth tax”—the senator said “Well, if we look at the reported billionaires’ list,” he observed that “they are not on the list of top taxpayers.” Gatchalian, to note, is expected to assume chairmanship of the Ways and Means committee when the 19th Senate opens on July 25.

He noted in a radio interview that “normally, our top taxpayers are known TV personalities, movie personalities who are so-called highprofile personalities.” Gatchalian added they often top the list of the Bureau of Internal Revenue (BIR) because they “make sure to pay taxes.”

But the ones on the billionaires’ list, we don’t see them there, the lawmaker said referring to the BIR’S top taxpayers list.

At the same time, the senator stressed, speaking partly in Filipino, that “there is really a need to fix the system so that the ones who are really rich and can afford will pay higher.:

“That is what we call the concept of progressivity—those who can afford should pay more.”

Asked to comment on an Ibon Foundation research that there are 2,019 billionaires in the country, Gatchalian admitted he doesn’t know the exact number but pointed to the annual Forbes list of richest individuals.

However, he observed that “when one looks at the list of top taxpayers of BIR, many of the names [on Forbes’ list] are not there,” adding that this makes one wonder.

“At yun ang nakakapagtaka dahil kahit sila ang pinakamayayaman na pamilya sa ating bansa, pero hindi naman nasa top taxpayers. Kaya meron talaga tayong dapat tignan para yung mga mayayaman o yung mga may kayang magbayad ay dapat mas malaki ang kanilang dapat bayaran.” [And that’s puzzling, because even if they’re the richest people in the country, they’re not top taxpayers. So we really have to assess the system so that those who are really rich or can afford will pay more.]

Ofreneo’s pitch

IN June, Economist and Businessmirror Columnist Rene Ofreneo noted that the discourse on imposing a wealth tax has attained more currency especially during the pandemic, when systemic inequalities were highlighted.

Alluding to then outgoing Finance Secretary Carlos G. Dominguez’s pitch for the incoming Marcos Administration to raise new taxes and postpone the scheduled tax reductions for certain categories of income earners, Ofreneo noted that clearly, “more borrowing is not a viable option.”

According to Ofreneo, the national debt amounting to close to P13 trillion is “truly alarming.”

“Every Filipino, young and old, is now indebted by around p 117,000.00. The debt-to-gdp ratio is also headed towards the 70 per cent level, or 10 per cent above the globally-accepted standard of the maximum level of debt sustainability.”

However, Ofreneo said imposing more taxes or resorting “to stringent austerity measures when the times call for more stimulus spending to rev up the economy and provide amelioration assistance to the impoverished millions who gifted Ferdinand Marcos Jr. with a landslide victory” does not seem viable.

“Are there other options other than more borrowings and more VAT and excise taxes? There is. Impose wealth tax on society’s most capable,” Ofreneo said. “In fact, wealth tax has become a prominent topic in global economic forums.”

He further explained that heavilyindebted countries that have been weakened by the Covid pandemic are being urged to enact wealth tax laws to enable their governments address the cost of the pandemic and nurse their economy back to health.

“More borrowing and more taxes only contribute to the deepening of their debt-economic crisis.”

Ofreneo noted that “the global discourse on wealth tax as an alternative fiscal measure received a boost from the world ’s leading creditor, the International Monetary Fund” itself in April 2021, which “formally called for governments to consider imposing higher taxes on the wealth of the rich to cover the cost of the pandemic and economic recovery.”