OVERPRICED, KICKBACK-RIDDEN ODA PROJECTS’ PAYMENTS NOT PROJECTS FOR THE POOR, BEHIND VAT COLLECTIONS

Gabriela Women’s Party Rep. Liza Largoza Maza today said that it is the government’s overpriced ODA obligations and not the poor that is the reason behind President Arroyo’s mulish stance against the scrapping of the 12% Value Added Tax.

“A huge chunk of the government’s spending still goes to foreign debt payments. And for the past seven years, ODA availments have increased the debt service burden, ” said Maza citing IBON studies indicating that around 40% of outstanding foreign debt may be attributed to ODA loans.

“The disadvantageous and kickback- ridden Northrail project alone compels the government to pay $400,000 in monthly interests alone.  In addition to this we are also paying for several other overpriced ODA projects such as the P3.6B Bohol Irrigation Project Phase II, the $465.5 M Cyber Education Project among several others,” said Maza.

DEBATE
“Sa totoo lang, ang paggamit sa mahihirap na dahilan para sa patuloy na koleksyon ng VAT ay katulad ng pagprito sa mga mahihirap sa sariling mantika. This government take the poor Filipinos for fools if it thinks insulting subsidies are enough to make the people believe that we are enjoying the fruits of the VAT. We doubt if she can debate with and defend her VAT collections to the impoverished mothers lining up for cheap NFA rice, and insulting electricity subsidies,” said Maza.
The Gabriela solon also belied Arroyo’s claims and insisted that the government can very well still provide for projects for the poor sans the VAT collections. “Government claims it will lose Php73.1 Billion should the government cease VAT collections. But this can easily be resolved by addressing graft and corruption in tax collections.”
Maza cited statistics from the IBON Foundation and the National Tax Research Center which estimate that graft and corruption in revenue collections have cost government Php82 Billion in uncollected corporate taxes in 2006 and an average of Php57 Billion annually in uncollected VAT.

Gabriela Representatives Maza and Luz Ilagan have filed HB 3458 removing the 12% VAT on oil products and HB 3433 to repeal the RVAT. They are also supporting several measures in Congress that seek to amend the RVAT approved in 2005.

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