Press Release
July 2, 2007

JAMBY SETS HER SIGHTS ON REPEALING EVAT

One of the first bills filed in the 14th Congress is Senate Bill no. 24 filed by Senator Jamby Madrigal seeking to repeal Republic Act 9337 otherwise known as the Expanded Value-Added Tax Law.

According to the Senator Madrigal, the imposition of the E-VAT has not improved the country's economy and many Filipinos continue to be impoverished, unemployed and have remained neglected of vital services such as education, health and social services.

"The current tax system of the country has remained "regressive," according to the 2007 Country Report on the Philippines of Social Watch, an international watchdog citizens network on poverty eradication. "

"The 12 percent increase in the VAT to increase revenues and jump-start the economy was a fallacy. The E-VAT from the very start was bound to fail because it was meant to serve only foreign creditors and investors who are benefiting significantly on tax incentives, and not the interest of the Filipinos," Madrigal says.

The Senator adds that a questionable policy of oppressive, mismanaged and corruption-tainted debt service or paying off debts has perpetuated the regressive cycle. A huge chunk of the country's borrowings goes back straight to the creditors through debt servicing.

She says that while the government tries to repay as much debt as it could, total national government debt still increased marginally to P3.914 trillion in October 2006 from P3.888 trillion in the same period in 2005.

Senator Madrigal exclaims that our debt crisis is already a chronic disease. In early January 2007, the government already borrowed $1 billion from the international capital market and aims to borrow at least $1.47 billion more in development assistance from the World Bank, Asian Development Bank and the Japan Bank for International Cooperation. Some P260 billion are also going to be borrowed domestically also this year.

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