Resistance grows vs tax on text bid

09/15/2009

The opposition against a House push to impose a five-centavo tax on each text message is gaining as a senator and a consumer group demanded that the bill seeking to impose the tax be withdrawn.

Opposition Sen. Chiz Escudero said lawmakers should, instead, set their sights on raising the tax on luxury goods such as motor vehicles and jewelry instead of taxing text messages.

"The proponents of the measure to tax text messaging seem to have a skewed sense of priority. Instead of providing tax relief to the Filipino public, they think of adding burden," Escudero said in a statement.

Phone users group TXTmate said while the House bill seeking to impose a five-centavo tax on text may have a sound intent, the means sought to achieve raising government revenues are "rife with serious concerns that need to be addressed if the bill would be enacted into law."

Escudero said taxation should be based on the ability of taxpayers to pay.

"We all know text messaging is prevalent among the lower socio-economic classes, that about 90 percent of mobile phone lines are pre-paid. Imposing a tax on it will hit the masa more than those with the capacity to pay more. So why not increase the taxes on items used by those who can and are willing to pay, like luxury cars and jewelry?" he said.

He explained that those who can afford to buy these luxury items certainly have the capacity to pay for more taxes, in contrast to the poor who are considered heavy text messaging users.

Escudero said that text messaging has become the one of the cheapest modes of communication. For poor Filipinos, it has even become an essential part of life.

"If the government has conceded that it cannot improve its tax collection efficiency nor curb corruption in revenue-generating agencies, then it should at least tax those who are better off, not those who have less," the 39-year-old senator said.

The ways and means committee of the House of Representatives recently approved a proposal to impose a five-centavo tax on text messages, highlighting a "no pass-on" provision in the measure to supposedly insulate the people from the tax.

"The no pass-on provision is useless and ill-conceived. Ensuring compliance will be virtually impossible. This measure should be stopped dead in its tracks and be prevented from moving forward," Escudero said.

The senator vowed to block the proposal if and when it reaches the Senate.

TXTmate said there is the question of privacy that may be violated if the bill is enacted.

"To monitor actual cellphone use, the metering device would have to distinguish between true and false use of the telecom service, for example, placing a call that actually connected or sending out a text message that was actually received, not just the fact that there was a transmission of data," it said in a statement.

To compute whether a connection has actually been made, the metering device would have to verify each instance of cellphone use. This means, the metering device would have to record who made the call, who received the call, and the time the call was made, it added.

Knowing that it is the government agencies that would be using these metering devices, there implies that the government can now have access to personal information of each cellphone subscriber using the service, TXTmate said.

We believe that this is in serious violation of our constitutional right to privacy and may pave the way for other more grave intrusions like wire-tapping into private conversations, it said. These metering devices would give the government unbridled access to our day-to-day communications, the group said. Even with the provision in the law that the burden will not be passed to the end-consumer or mobile subscriber, there is no sufficient guarantee that the cost will not ultimately be shouldered by us — the subscribers, it said.

Given the highly technical nature of the industry, it would be just as easy for telecommunications firms to reallocate or reclassify the additional expense to another cryptic technical category which would leave the mobile subscriber paying for it in the end, it said.

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