Congress won't pass tax laws due to lack of time

Revenue measures endorsed via last-ditch appeals by Malacañang and the business community given the country's weak finances will not be approved by the 14th Congress. Legislators return to work today following the holidays and the Palace and foreign chambers earlier this month zeroed in on the passage of two measures: the rationalization of fiscal incentives and simplified net income taxation. The Senate and the House of Representatives will be in session for just three weeks, or up to Feb. 5, before lawmakers turn their attention to the May elections. Session then resumes on May 31 to June 4 for the canvassing of election results, which will wrap up the 14th Congress' three-year term. Given disparate versions, there is "not enough time" to allow for approvals, Senate President Juan Ponce Enrile said. This prompted a Palace official to raise the prospect of a special session being called by President Gloria Macapagal Arroyo. A Finance official, however, downplayed the impact of the 14th Congress' being unable to pass the two measures. House Speaker Prospero C. Nograles, meanwhile, stressed that the lower chamber had already done its part. "These bills... have already been passed by the House," he said in a text message. Enrile said the House version of the fiscal incentives rationalization measure was markedly different from the various Senate proposals that had yet to be consolidated at the ways and means committee. "The Senate bills are being opposed by PEZA (Philippine Economic Zone Authority) and the BoI (Board of Investments) ... I think due to the contentious differences of the bills [from that of the House], there is simply not enough time to harmonize these versions," he said in a telephone interview. Three Senate bills -- 1640, 2375, and 3136 -- all seek to amend the current incentives structure. The House, meanwhile, has already approved House Bill 5241. As for the Simplified Net Income Taxation Scheme (SNITS) which the Senate removed as a rider to Republic Act 9504 or the Income Tax Exemption to Minimum Wage Earners, stiff opposition is still being raised by affected professions, Enrile said. Incentives rationalization and the SNITS are expected to bring in at least P10 billion and P5.24 billion in annual revenues, respectively. Gary B. Olivar, deputy presidential spokesman for economic affairs, said Malacañang could call a special session given the likelihood that Congress would only pass one Palace-certified bill, and a nonrevenue one at that. The Palace's list comprises eight measures: aside from the rationalization of fiscal incentives and SNITS, it also wants Congress to approve a liquefied petroleum gas bill, another promoting breast-feeding, gun controls, a disaster risk reduction management (DRRM) framework, the proposed maritime code, and an amnesty proclamation for rebel returnees. Only the DRRM bill, which is up for bicameral conference approval, has any chance of being approved in the next three weeks. "It seems that one out of eight is such a low number... I would not be surprised if the President would ask Congress to hold a special session in order to pass these bills that she has certified urgent, but as of the moment, there is still no word from the President if she plans on doing that," he said in a separate telephone interview. Enrile said a special session was not necessary given the chamber's commitment to pass what it thinks are priority measures. Nograles, while open to the idea, said: "We should be able to assess from our peers whether we can get enough warm bodies to attend." Finance Assistant Secretary Teresa S. Habitan, for her part, said current 2010 revenue targets do not include forecast earnings from the two bills. "They [the bills] do not factor in the revenue generation program for 2010, but they could have been additional revenues for this year," she said. It would be "okay", she added, if approval is done by the 15th Congress which takes office on July 26. The Joint Foreign Chambers last week also called on Congress to approve the creation of a Department of Information and Communications Technology (DICT) in addition to the incentives and SNITS measure. The House has already passed its version of the DICT bill while plenary debates still have to be conducted at the Senate. Congress' priorities for this session, meanwhile, include: • a bill providing 10 percent allowable income tax deduction to lawyers who provide free legal assistance; • the cybercrime measure which seeks to penalize data fraud; • a bill providing state witnesses with hospitalization benefits while in custody and free education for their dependents; • the proposed Mindanao Development Authority; • a bill that mandates the use of helmets by motorcycle drivers and riders; • the expanded Senior Citizens' Act that seeks to maintain a 20 percent discount; • the proposed Freedom of Information Act; • changes to the Magna Carta for Persons with Disabilities; and • the Immigration Act. — BUA, JFSV