By Reihana Mohideen
A number of activist groups, including the People's Coalition against Vat (KOMVAT) and Kill VAT are planning major protest actions against the Ramos governments' expanded value added tax (VAT) law. The actions are being timed to coincide with the July 25 opening of Congress.
The tax is a single flat 10% levy on a wide range of goods and services. The first phase of it, sarcastically referred to as the "mother VAT", was introduced by decree in 1988, by former president Cory Aquino.
Bills have been filed in the Senate and the Congress calling for the repeal of the expanded VAT. Plans to introduce the tax coincide with the negotiation of a US$680 million loan from the International Monetary Fund. According to anti-VAT campaigners, the Ramos government offered to implement the expanded VAT law in order to reduce the burgeoning budget deficit.
KOMVAT is campaigning to stop the VAT and institute a review of the entire tax system. The KOMVAT alliance includes SANLAKAS (a federation of community, urban poor and women's organisations), trade unions, religious groups (such as the Catholic Bishops Conference of the Philippines) and even sections of big business (such as Jose Concepcion, a major player in the food industry).
Kill VAT is campaigning for the repeal of all VAT laws including the 1988 decree. One of the main organisations involved in Kill VAT is the Freedom from Debt Coalition.
Tony Cabardo, vice president of SANLAKAS, told Green Left Weekly that Kill VAT and KOMVAT compliment each other. "Kill VAT campaigns for the repeal of the law as a whole. KOMVAT is attempting to broaden the opposition against the expanded VAT, and serves as an umbrella group for those who oppose the most regressive aspects of the law.
"We needed to make allowances for the somewhat ambiguous position of the Catholic Bishops Conference which called for an entire review of the VAT and other tax laws. But, as a result of its participation in KOMVAT, Bishop Bacani, the Auxiliary Bishop of Manila, has written a letter to all parishes asking them to join the July 25 rally."
The Trade Union Congress of the Philippines has recently withdrawn from KOMVAT and has taken a position in support of the expanded VAT law. Cabardo said this was no big surprise.
"The Secretary General of the TUCP, Senator Herrera, is the main sponsor of the bill in the senate. This has exposed the TUCP as an organisation that is under the control of those aligned to the Ramos government and not the labour movement. Many on the executive board of the TUCP are appointees of Ramos."
According to Cabardo, the break has also highlighted rifts inside the TUCP between the more progressive elements who are against the VAT law, "but who cannot push the organisation to campaign against the Ramos government", and the Ramos appointees.
Cabardo explained that the TUCP's support for the law "will have a very serious effect on the unity of the labour movement. The BMP, [one of the trade union affiliates of SANLAKAS], will be pushing for the TUCP to be ejected from the caucus campaigning for a united labour movement".