Congressman now Governor Tet Garcia, an accountant by profession, said that it is the other way around that VAT has more loopholes. Tax on Gross is according to him more simpler while VAT has many loopholes and leakages which cost the Gov't a 50% revenue loss. He said the Gov't doesn't have the enough manpower or the technical structures or facilities to check all those receipts. While in the interview by Ding Pascual, he stated that it's actually a 75% loss. It is for this reason they expanded the coverage of VAT to include oil, tollways and electricity, from 10% to 12&. And now they are planning to make it 15% as said before after SIN tax.
The government will collect practically the same revenues from the 10-percent Value-Added Tax as from a straight 3-percent sales tax on the same goods and services.
The big difference is that forcing VAT on the market will raise prices by about 10 percent, and possibly kick up a mini-storm – while a simple 3-percent sales tax will nudge prices by only 3 percent.
Another big difference is that VAT entails a complicated process of collecting a 10-percent "output" VAT from the buyer then allowing the seller to deduct from it 70-percent of the "input" VAT that he had paid his supplier – and remitting the difference (around 3 percent) to the government within three months.
In contrast, if a 3-percent sales tax were imposed instead of a 10-percent VAT, the sales tax would simply be slapped on the goods, period, and the tax collected is forwarded to the government without crawling through a minefield of opportunities for cheating.
As the system of “floating-exchange” rates , implemented in 1971-72, provided the mechanism for the world’s rapacious creditors, represented by the IMF, to impose periodic and continuous devaluation of our currency, thereby automatically and onerously increasing our foreign-debt stock and immoral payments thereof;
Then, in the speculative binge against the Asian currencies in 1997-98 by George Soros and his hedge fund allies, the Philippine peso was driven down to less than half its 1997 value. In 2005, an EIR study of the effect of this looting process showed that the foreign debt in 1998 was $46 billion. Over the next six years, the government paid $47 billion in debt service, forced to exchange increasingly devalued pesos for dollars in order to pay that foreign debt. EIR calculated that, if the peso equivalent of the debt paid in those six years were calculated at the 1997 exchange rate, before the forced devaluation, the nation would have paid $89 billion in debt service—i.e., nearly twice the total debt owed. And yet the nation ended up owing more than it had in 2007!
This illegitimate debt has been paid, on time, by subservient governments right up to today, through two primary means: the virtual enslavement of the brightest of the Philippine youth, including many college graduates, as service workers for the imperial powers, doing 12-hour overnight shifts in “call centers,” serving the customers of Western banks, computer companies, and other corporate structures. In the past such persons were called “house slaves.”
The country’s second source of foreign exchange income is the export of its skilled and unskilled work force, in most cases forcing men and women to leave their families to work abroad as maids, nurses, drivers, and so on. Their remittances provide about $17 billion annually for servicing the foreign debt. While millions of nurses have been sent abroad (and even doctors who switch to nursing abroad to make enough money to support their families), over 100 hospitals have been closed in the Philippines due to lack of staff and adequate resources. Most poor Filipinos never see a doctor or a hospital in their entire lives.
Almost half of our budget, goes to debt servicing. And thus some countries give way to the austerity measures imposed by IMF-WB. And so we have reduced spending on public services such as health, infrastructures, agricultural support, etc. Thus our Gov't rely on PPP for the infrastructures and CCT as token dole outs for public service. For PPP, the Gov't spends the bulk, while the private sector eventually owns those assets. We don't even need to borrow anylonger accdg to Herman-Tiu Laurel, the GIR/SDA is big enough to pay all our foreign debts at one go.
We should follow the example of Kirchner of Argentina which turned their country around from crisis into highest growth second only to China by saying no to the greedy loansharks. The people of Iceland said no also to this form of financial terrorism http://rediceradio.net/radio/2012/RI...icrane-hr1.mp3 . What the loansharks do is simply a form of legalized Plunder which an insider, a former self-confessed economic hitman, John Perkins, termed as Predatory Capitalism of the Corporatocracy. http://www.bibliotecapleyades.net/ar...omichitman.pdf