EDITORIAL
A monomania for state revenue
Tomorrow, April 15, is the deadline for the filing of the annual income tax return
and the payment of the tax due thereon. As taxpayers rush to beat the deadline, it is
important to revisit the reason why those who are able to pay are forced to pay the
state exactions called taxes.
Taxes are what we pay for a civilized society. This oft-quoted statement byUS
Justice Oliver Wendell Holmes still holds true today despite the changing business
landscape and the modernization of society. Commissioner v. Algue further explains that
taxation is the indispensable and inevitable price for a civilized society, and without
taxes, the government would be paralyzed.
This philosophy that justifies every imposition of taxes is nearly impossible to
challenge in court since to question the state’s power to impose taxes is like striking the
very core of our existence as a nation. Everyone knows that taxes are the lifeblood of
this country. We have been told and indoctrinated that there is no other way to sustain
the government except to pay the enforced contributions. In a legal battle between the
tax collector and the taxpayer, the latter more often than not prevails all in the name of
the necessity for the continued existence of the government.
As we comply with our duty as citizens, a very notable critique of our current tax
system exquisitely elaborated by former Justice Dante Tinga in ABAKADA Guro Party
List v. The Honorable Executive Secretary Eduardo Ermita is worthy of reflection. He
lamented in a strongly-worded dissent that we are condemned by a national policy
driven by the monomania for State revenue. Persons with monomania are those who
are extremely interested in only one thing, often to such a degree that they are
mentally ill.
Justice Tinga criticized that the VAT withholding tax system on government
transactions was selfishly designed to increase government revenue at the expense of
the survival of local industries. Unfortunately, under the device employed in the E-VAT
law, the price to be paid for a more sustainable liquidity of the government’s finances
will be the death of local business, and correspondingly, the demise of our society. It is
a measure just as draconian as the standard issue taxes of medieval tyrants.
How are we to survive as a nation without the bulwark of private industries?
Perhaps the larger scale, established businesses may ultimately remain standing, but
they will be unable to sustain the void left by the demise of small to medium
enterprises. Or worse, domestic industry would be left in the absolute control of
monopolies, combines or cartels, whether dominated by foreigners or local oligarchs.
The destruction of subsisting industries would be bad enough, the destruction of
opportunity and the entrepreneurial spirit would be even more grievous and tragic, as it
would mark as well the end of hope.
The good justice ended his opinion in this wise: “Taxes may be the lifeblood of
the state, but never at the expense of the life of its subjects.”