Walk the talk

By Joshua Corcuera

Last February 7, President Ferdinand Marcos Jr. encouraged the public to pay the correct amount of taxes so that the Philippines would be able to completely recover from the pandemic and to grow and develop as far as the economy is concerned.

In his own words, “I encourage the public to pay the correct amount of taxes on time to support the country’s economic recovery and expansion so critical in this time.” Based on these words, one may argue that the intention of the president is good. After all, taxes are the lifeblood of the government and such revenues enable the-powers-that-be to defray necessary expenses for public service or public use, such as schools, hospitals, roads, and the like. Without taxes, the government would be paralyzed and, as a consequence thereof, public services that benefit many people would come to a halt.

However, this statement did not sit well with many people especially in social media—and for a valid reason. For context, the Bureau of Internal Revenue, the tax authority of the country, sent a demand letter to the Marcoses in December 2021 in regard with the family’s estate tax dues. Such liabilities, as reported by several news outlets, have ballooned to PhP 203 billion from about PhP 23 billion in 1997.

In line with this, a ruling from the Supreme Court in March 1999 has shown that the assessment on estate tax amounting to PhP 23 billion was final and executory. The widespread criticisms against the president’s statement, to me, is valid as it has a legal basis to speak of.

To be fair, the president argued that this case should be opened, claiming that they were not given the chance to respond. This, however, seems to be fishy; it appears to be a weak defense. This is because the Marcos family had actually returned to the country by the early 1990s. As a matter of fact, Marcos Jr. himself was a representative from the province of Ilocos Norte starting 1992 upon their return from exile.

With all these facts, I believe that it is beyond essential for the president to “walk the talk.” As the saying goes, a good leader is a good follower. Henceforth, it is imperative for the chief executive to address these tax-related issues in a timely manner, and pay the right amount of taxes as well, so that Filipinos would be genuinely encouraged to follow suit. Giving a mere statement of encouragement is not the best option as valid questions regarding serious issues were left unanswered.

Each and every student of accountancy, business, or law knows by heart, or is at least familiar, that the power of the state to tax is comprehensive, aside from being unlimited, plenary, and supreme. When we say that the power to tax is comprehensive, it is so because it covers all subjects without exceptions; it covers all persons, regardless of whether one is rich or poor, powerful or ordinary, and so forth. Further, taxation covers not only persons, but also all businesses, transactions, exercise of privilege, and practice of profession.

It logically follows, therefore, that we all have to pay taxes. And when we say “all”, we are pertaining not only to ordinary people, but also powerful politicians, as well as wealthy businessmen including the richest Filipino. A good leader is a good follower; conversely, a poor follower is a poor leader.