ZAMBOANGA CITY (Mindanao Examiner / Dec. 5, 2011) – A Filipino lawmaker has criticized a government proposal to impose taxes on voluntary contributions to social security and health system, among others.
Congresswoman Luz Ilagan said taxing voluntary contributions to Social Security System, Philippine Health Insurance Corporation, Home Development Mutual Fund and even to the Government Service Insurance System, is an added burden to the growing ranks of the so-called self-employed and own-account workers which include vendors, migrant workers and jeepney drivers who could barely manage to save for their retirement or for emergencies.
“This is yet another blow amid growing the country’s poverty and unemployment,” she said.
The Bureau of Internal Revenue has issued Memorandum Circular No. 53- 2011 which states that voluntary contributions to the SSS, GSIS, Pag-IBIG and PhilHealth are subject to tax.
Ilagan said it is wrong to impose taxes on voluntary contributions.
“These are hard earned savings that come from working extra hours, taking more hazardous jobs and belt tightening by scrimping on the family budget. There is no way that the Philippine government can justify the taxes being imposed on the informal sector as it consistently cuts back on spending for social services,” she said, adding the 2011 national budget reflects cuts on appropriations for education, health and housing which deprives the poor of basic government services.
Ilagan called on the government to immediately revoke the memorandum and instead focus its efforts on chasing after the big tax evaders.
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