The so-called Recto report that proposes additional taxes for tobacco
and liquor products drastically lower than what the Philippine Palace wants is
now in limbo.
Senator Franklin Drilon, acting
chairman of the Senate ways and means committee, will call a meeting of panel
members on today to decide whether the report will be retained or brought back
to the committee.
Sen. Ralph Recto resigned as
committee chairman on Monday after complaining that his effort to sponsor the
bill imposing an additional 15 billion pesos (US$363 million) “sin tax” on alcohol
and tobacco products failed to get the support it needed from officials of the
health and finance departments.
Recto alluded to Health Secretary
Enrique Ona, Finance Secretary Caesar Purisima and Internal Revenue
Commissioner Kim Henares during a privilege speech announcing his resignation.
The officials expressed
disappointment over Recto’s committee report the day after his sponsorship
speech. They said they had expected Recto to present a report that adhered to
Palace's proposal to raise 60 billion pesos.
Supporters of the Palace's
proposal said higher sin tax rates would not only reduce deaths from diseases
due to tobacco and liquor consumption, but also generate more funds for the
government’s health programme.
Resignation accepted
Senate Majority Leader Tito Sotto
announced the chamber’s decision to accept Recto’s irrevocable resignation as
ways and means chairman immediately after a caucus Tuesday afternoon.
Drilon as vice chairman was
designated acting chairman after the caucus.
Committee members expected to
attend the meeting Drilon called for on Wednesday include Senators Francis
Pangilinan, Teofisto Guingona III, Sergio Osmeña III, Francis Escudero,
Gregorio Honasan, Manuel “Lito” Lapid, Ramon Revilla Jr., Antonio Trillanes IV,
Manuel Villar, Edgardo Angara, Miriam Defensor-Santiago, Joker Arroyo and Pia
Cayetano.
Committee or plenary
First on the agenda is whether to
let the committee report stay as Recto had presented it during the plenary
session last week, according to Drilon.
“If it stays in the plenary, it
becomes the basis for the debates,” Drilon told the Inquirer in an interview
after the caucus.
“If the decision of the (members)
is to recommit it to the committee, then the report is withdrawn from the
plenary and the committee will determine whether to refile the report as is or
have a new report,” the acting ways and means chairman added.
“To recommit means you take it
out of the agenda of the plenary,” he further explained.
No more hearings
Drilon said there was no more
need to conduct additional hearings as those conducted by Recto “were enough
already.”
Before the caucus, Senate
President Juan Ponce Enrile and Drilon offered two conflicting proposals on how
to go about the sin tax bill after Recto stepped down.
Drilon said whoever was appointed
acting chairman in Recto’s place would continue to sponsor the bill on the
floor despite Recto’s announcement that he was withdrawing it from the plenary
for lack of support from its proponents from the executive branch.
Drilon cited the opinion
volunteered by Escudero that the withdrawal of a committee report would need
the concurrence of all committee members or the plenary where it was presented
when the chairman delivered his sponsorship speech.
After Recto announced his
resignation, Escudero told the plenary that a committee chairman could not
submit a committee report on his own since he would need the signature of the
majority of the members of the committee before doing so.
This means the withdrawal of a
committee report “also cannot be done by the chair on his own, and would either
necessitate the majority vote of the committee members at the very least or by
plenary,” Escudero added.
Drilon invoked public interest in
discussing the same report, saying that senators can debate on its provisions
and introduce amendments, specifically those that would bring more revenues.
Personal stand
Drilon said his “personal stand”
would be an annual revenue collection “closer to 60 billion pesos” that
proponents from the Palace had sought.
The senator said the government’s
current PhilHealth insurance budget this year, for example, was only 12.5
billion pesos.
“We would need at least 12.5
billion pesos more for the 5 million new enrollees,” he said.
“Senator Recto’s replacement
would not start from scratch. The Senate can eventually adopt a higher revenue
target. That’s always a possibility given the period of amendments. Even if the
senator has not resigned, the committee report is still subject to amendments
on the floor,” Drilon explained.
Not so, Enrile countered.
Since Recto resigned because the
Palace officials concerned with taxation were displeased with his report, “we
have not improved the situation if the new chair adopts (his) report,” the
Senate President said.
Asked if the ways and means
committee would like to start from scratch and hold a new round of hearings,
Enrile said: “Yes, in effect. That’s my reading.”
He added that whoever was chosen
to chair the committee would “unlikely” continue sponsoring Recto’s report on
the floor “because it has become controversial. They (executives in charge of
finance and revenues) do not like that version.”
Enrile said that the new chairman
would now likely choose between a sin tax bill filed by Senator Santiago that
observers said veered close to the revenue targets of the Palace or another
measure proposed by Sen. Panfilo Lacson.
“Which one will be adopted we do
not know. But since there’s an evident desire on the part of the proponents to
get the maximum revenue, then logically whoever will take over from Senator
Recto will probably adopt the bill of Senator Santiago and that will have to be
debated on the floor,” the Senate President said.
Question hour
Enrile and Sotto said separately
that it was likely that Purisima and Ona would be invited to a Question Hour so
they could personally answer queries from senators about the sin tax bill.
The Senate needs to pass the
measure before it tackles the 2-trillion pesos proposed budget for 2013.
Drilon as Senate finance chairman
earlier said the chamber needed to pass the sin tax bill since its target
revenues had already been factored in the 2013 budget.
The House of Representatives is
expected to push for its own version of the sin tax bill when the measure gets
tackled in the bicameral conference committee, said its principal author,
incoming Transportation Secretary Joseph Abaya.
Abaya said it was not yet the end
for the House version of the measure, which would hike revenues through reforms
in the excise tax on tobacco and alcohol products to about 30 million pesos a
year.
He said the House version could
be pushed in the bicameral conference committee even though he would no longer
be around to do it himself.
He is leaving his post as Cavite
representative and House appropriations chairman and moving on to head the
Department of Transportation and Communications, now that he has shepherded the
2013 budget through third and final reading in the House.
“I’m sure the House will field a
capable panel to fight for our version,” he told reporters.
Not the end
Asked if he was disappointed at
the Senate version, he said there was still the bicameral conference committee,
which is where the final version of proposed laws are crafted before being
ratified by both chambers of Congress.
“I’m sure a more able-bodied
person will be there to fight it out. These are all in transition. Not the end
still,” he said.
He said he wanted to see reforms
in the sin tax bill that would deter people from smoking and drinking. These
include the dismantling of annexes in the internal revenue code that shield
certain products from higher taxes.
With a report from Leila B.
Salaverria
*US$1=41.2 pesos
Cathy C. Yamsuan
Business & Investment Opportunities
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