If we lack funds for much-needed immunization and health care and to propel the pandemic-stricken economy, then we should look no further than the suggestion of the Ibon think tank and the Makabayan bloc to Congress: billionaires!
Of course, workers and entrepreneurs do not have the capacity to pay a new tax. In fact, they are badly in need of aid and stimulus funds to survive, with the botched pandemic response that has needlessly prolonged or worsened our national situation since March 2020.
However, a very small subset of the population not only protected themselves from the pandemic and the inept state response. They even took advantage of it.
Ibon says there are now 2,919 Filipino billionaires with some 8.1 trillion pesos in combined wealth.
âThey represent less than 0.003% of the population but hold 16% of the country’s wealth. Taxing only those billionaires with a wealth tax of 1% on wealth exceeding 1 billion pesos, 2% on 2 billion pesos, and 3% on 3 billion pesos can generate some 467.1 billion pesos in income for them. social services, welfare and other government programs, âIbon said.
Referring to published reports, Ibon adds that âthe reported net worth of the richest 50 Filipinos has risen even amid the pandemic to reach 3.9 trillion pesos or $ 79 billion in 2021. A wealth tax on them alone can generate up to 224 billion pesos in income. âWould billionaires bleed so much money that they would become poor because of this proposed tax? No. They would remain billionaires or multi-billionaires. It’s not like their properties and bank accounts are going to be raided. proposed targets only one to three percent of their total wealth, and they can still keep 93 to 99 percent of their money, private jets, yachts, mansions, resorts, jewelry and golf club memberships and other wealth.
Many would also argue that such a tax would ultimately benefit the super rich themselves. This is because a better served and healthier nation would create more wealth for everyone, including the rich.
In its explanatory note to House Bill 10253, or the Super Rich Tax of 2021, the Makabayan block stated that âPhilippine taxation for the longest period has been largely taken from what people pay, what they pay. consume or what they earn, and [has] never implemented a tax on large fortunes.
If passed, the bill provides that the revenue from the billionaires’ tax would go to: medical assistance and the health facility improvement program (60%); and education, social protection, employment and housing for the poor (40 percent).
“The billions in revenue of [the billionaire tax] would help the government continue its anti-poverty measures and other social programs that would help bridge the widening gap between rich and poor, âMakabayan lawmakers added.
According to Ibon, the revenue from the billionaires’ tax is “more than enough” to provide adequate assistance to workers, farmers and micro, small and medium enterprises.
Ibon calculated the figures: 186 billion pesos for emergency aid for 18.6 million households at 10,000 pesos each; 101 billion pesos for MSMEs in the form of a wage subsidy to support the salary increase of 100 pesos / day for three months; and 220 billion pesos to support farmers.
Ibon and Makabayan are also urging the government to redirect non-essential credits, including some infrastructure, counterinsurgency funds like the 28.1 billion peso budget for NTF-ELCAC, and automatic debt payments.
Obviously, there are other really urgent and essential needs that could be met if these funds were redirected. The NTF-ELCAC budget could be cut and the budget fully redirected to the Tropical Medicine Research Institute and the Philippine Genome Center to expand the capacities of these agencies, acquire equipment, and recruit and retain staff.
Taxing the super-rich is nothing new. Many countries have done this to tackle inequalities in gross income and wealth, and to raise incomes so that governments can provide adequate services to citizens. It’s sound economic policy in the midst of the pandemic that it’s not just Ibon, Makabayan or Bernie Sanders fighting for a wealth tax.
Ask Nobel Laureate in Economics Joseph Stiglitz, the World Economic Forum (WEF) and the International Monetary Fund. They are also endorsing a tax on the super rich.
The alternative is to tax everyone, including the laid-off and the unemployed, underemployed, small closed businesses and others who need help.
The state should help and ask billionaires and multi-billionaires for a fairer “ambag”.
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