ALMOST DONE. Department of Public Works and Highways personnel clean the potion of the southbound lane of the Edsa-Kamuning flyover in Quezon City on Wednesday (July 20, 2022). The flyover was closed to traffic last June 25 for repair and rehabilitation. (MNS photo)

MANILA, July 21 (Mabuhay) –If the government’s running debt pile of P12.5-trillion will be divided among the the country’s 110 million population , each Filipino owes over P112,000 which will be paid in the form taxes, economic think tank IBON Foundation said Wednesday.

Data presented by IBON showed that the debt per Filipino amounted to P112,678 while each family owes P474,543 in debt if the debt is divided among 26.3 million families.

In his presentation during a forum, IBON executive director Jose Enrique “Sonny” Africa said that the poor bear a “disproportionate burden of repaying debt” due to the “regressive” tax system.

Africa said the last administration’s TRAIN (Tax Reform for Acceleration and Inclusion) and CREATE (Corporate Recovery and Tax Incentives for Enterprises) laws were the “most regressive tax reforms in Philippine history” as these shifted the tax burden from large corporations to the poor and middle class.

For example, he said that the CREATE law was expected to generate revenue loss of P372 billion for 2021 to 2023 period, which will be translated into “additional profits given to corporations.”

The government’s outstanding debt stood at P12.49 trillion as of end-May, of which P8.66 trillion were sourced locally while P3.83 trillion were from foreign sources.

As of the first quarter of the year, the country’s debt-to-gross domestic product (GDP) ratio — the size of the state’s debt relative to the size of the economy — stood at 63.5%, its highest in 17 years and above the internationally recommended threshold of 60% of the economy.

To shift the “disproportionate burden” of repaying debt from the poor and middle class to the richest few of the population, Africa reiterated IBON’s wealth tax proposal.

He said that the estimated 2,919 billionaires in the country have a net worth of P8.04 trillion.

He added that a tax of 1%, 2%, and 3% for wealth of over P1 billion, P2 billion, and P3 billion, respectively can generate P470 billion.

“‘Yung hitsura ng debt crisis natin ngayon is the fact na ang nagbabayad ng utang na ‘yan ay ‘yung mahihirap at ‘yung middle class,” Africa said.

(Our debt crisis now is being paid by the poor and middle class.)

“If you make the tax system much more regressive, basically may (there is) a disproportionate burden on them… na bayaran ang utang na ‘yan (to pay the debt). The problem is, ‘yang utang na yan hindi naman sila nakinabang (they did not benefit from that debt). The biggest part of the debt went to financing infrastructure projects and to debt service to creditors,” he added. (MNS)

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