Batangas State University College of Engineering, Architecture and Fine Arts Electronics Enginnering Department

Technical Paper in Taxation and Land Reform

Submitted by: Semira, Pollard Jensen A. MeXE 5101

Submitted to: Engr, Robbie Christine Bathan Instructor

October 11, 2013

PNoy: Time to abolish the PDAF MANILA (UPDATE 3) - President Aquino is now in favor of abolishing the existing pork barrel system, saying that despite reforms, it continues to be prone to corruption. Panahon na po upang i-abolish ang PDAF, Aquino said in a live televised statement. Ngayon, bubuo tayo ng bagong mekanismo upang matugunan ang pangangailangan ng inyong mga mamamayan at sektorsa paraang tapat, gamit ang tama at makatuwirang proseso, at nang may sapat na mga kalasag laban sa pang-aabuso at katiwalian. Aquino made the statement following the release of the Commission on Audit report detailing misuse of the priority development assistance fund from 2007-2009 and allegations that public funds were funneled to bogus NGOs. PORK BY ANOTHER NAME? Aquino is instead proposing a system where lawmakers can still propose certain projects for their constituents but this time with several restrictions. There will be a menu that proposed projects should conform with and allocation for the approved projects will now appear in the national budget or the General Appropriations Act as line item, starting in 2014. Health services, scholarships, and livelihood projects are among projects that may still be allowed. Sisiguruhin kong bawat mamamayan at sektor ay makakakuha ng patas na bahagi ng pambansang budget para sa serbisyong pangkalusugan, scholarship, proyektong lumilikha ng kabuhayan, at lokal na imprastruktura. Makakapagmungkahi ng proyekto ang inyong mga mambabatas, ngunit kailangan itong idaan sa proseso ng pagbubuo ng budget, Aquino said. Kung maaprubahan, itatalang mga ito bilang mga line item, alinsunod sa mga programa ng Pambansang Pamahalaan. Mapapaloob ito sa batas bilang Pambansang Budgethihimayin ang bawat linya, bawat piso, bawat proyekto, gaya ng lahat ng iba pang mga programa ng inyong pamahalaan. Funds can no longer be funneled through NGOs and certain GOCCs, saying they had been used as instruments for corruption. Aquino wants the National Agribusiness Corporation (NABCOR) and its subsidiary, ZNAC Rubber Estate Corporation (ZREC), abolished. Consumable soft projects such as fertilizers and medicines will no longer be allowed, as well as short-term infrastructure projects such as dredging, desilting, regravelling, or asphalt overlay projects. Bawal na ang mga consumable na soft project tulad ng fertilizers, punla, gamot, medical kits, pustiso, paliga, training materials, at iba pang mga bagay na hindi masusuri kung totoo ngang may kinahihinatnan, o kung nagmumulto at pinagkakakitaan lamang, Aquino said. Lawmakers can only propose projects for their respective districts or constituents. Bid notices and awards for projects should be posted at the Philippine Government Electronic Procurement System or PhilGEPS website while details of the projects implementation should be posted at the website of the Department of Budget and Management, the respective agencies, and the governments National Data Portal. NO RESTRICTIONS IN PROBE Aquino has ordered the Department of Justice and other executive agencies under the InterAgency Anti-Graft Coordinating Council (IAAGCC) to cooperate with one another to speed up the investigation, prosecution, and recovery of ill-gotten wealth of those involved in the pork barrel scam. Malinaw ang aking direktiba sa lahat ng ahensya at kawani ng gobyerno: Ibigay an g inyong buong tulong at kooperasyon upang mahanap ang katotohanan, at nang mapanagot ang dapat managot, he said. He also vouched for the integrity of Ombudsman Conchita Carpio-Morales, Justice Secretary Leila de Lima, and Commission on Audit Chairperson Grace Pulido-Tan. Speaking to reporters, Aquino said there will be no restrictions in the probe, which would go beyond the involvement of Janet Napoles. Naalala niyo, ano, para talagang uminit lahat itong isyu dahil kay (Janet Lim) Napoles. Pero inuulit ng DOJ na, base doon sa COA na report, yun ang unang mga leads natin. So mas malawak kaysa doon sa sumasaklaw kay Napolesat wala namang limitasyon, he said.

NOT THREATENED BY PROTEST ACTION Aquino made the statement three days before the planned protest action against the pork. But he said that did not feel threatened by it. Bakit tayo kakabahan, dumami yung kakampi natin sa pagsasaayos sa sistema. Maraming salamat sa kanila, he told reporters. LUMP SUM FUNDS Reacting to a call of Senator Juan Ponce Enrile to abolish lump sump funds as well, President Aquino said there are funds that could be difficult to itemize such as the calamity and contingency fund. In principle, maganda nga sana yon kaya lang, kunwari calamity fund, ano. Paano mo i-aitemize at the beginning of the year yung paggagastusan nung calamity fund dahil wala pa yung bagyo, di ba? Wala pa yung lindol, wala kung ano man yung sakuna, di ba? he said. Yung contingency fund kaya nga tinawag na contingency dahil hindi Hindi pwedeng iprogram yung pangyayaring yon. Yung pagha-hire natin, for instance, ng teachersabout 30,000 na kakulangan ng DepEdhindi pa naman matukoy, iha-hire mo pa lang, so hindi mo pwedeng i-itemize yon. Aquino is instead pushing for greater transparency in the use of funds. Merong, by their very nature, there are certain funds na hindi pwede nating i-itemize. Pero, to a large degree, gusto natin talagang as transparent at madaling maintindihan kung ano yung nilalaan ng budget para pag tiningnan ng mamamayan may binanggit na kalsada dito, nakita ba niya? May tulay, may eskwelahan, etceteraklaro kung saan napunta yung bawat piso ng pondo ng bayan. Source: http://www.abs-cbnnews.com/nation/08/23/13/pnoy-time-abolish-pork-barrel

FACTS OR PROBLEMS Amid public outrage over misused public funds, President Benigno "Noynoy" Aquino III has called for the abolition of the Priority Development Assistance Fund (PDAF) or the "pork barrel." Two days before a planned massive protest over the PDAF scam, Aquino faced the nation and vowed to remove PDAF and with the help of Congress, draft a new fund appropriation system. Aquino's announcement comes on the heels of the controversial P10-billion "pork scam," involving businesswoman and now fugitive Janet Lim Napoles who allegedly helped lawmakers divert public funds to non-existing non-government organizations. Aquino, flanked by Senate President Franklin Drilon and House Speaker Feliciano Belmonte, also called on the public to help the government scrutinize projects.

ALTERNATIVES Aquino is instead proposing a system where lawmakers can still propose certain projects for their constituents but this time with several restrictions. There will be a menu that proposed projects should conform with and allocation for the approved projects will now appear in the national budget or the General Appropriations Act as line item, starting in 2014. Bid notices and awards for projects should be posted at the Philippine Government Electronic Procurement System or PhilGEPS website while details of the projects implementation should be posted at the website of the Department of Budget and Management, the respective agencies, and the governments National Data Portal. If the pork barrels of the senators and congressmen is abolished, these funds must certainly go to the health services, scholarships and livelihood projects for the poor. Lawmakers can only propose projects for their respective districts or constituents. There must be a new system to be set up to give assistance to the countrys impoverished citizen.

CONCLUSION 1. Government projects will come from a "limited menu". 2. Consumable "soft projects" such as fertilizers, seedlings, medicine, medical kits, training materials, among others, that cannot be scrutinized properly are prohibited. 3. Temporary infrastructure projects such as dredging, desalting, or asphalt overlay projects are also not allowed 4. Public funds will no longer be diverted to non-government organizations and governmentowned and controlled companies such as ZREC at NABCOR. "Bubuwagin na po ang mga GOCC na ito at iba pang tulad nila, na paulit-ulit na ginamit sa kuntsabahan, at parang wala namang ibang silbi kundi ang maging instrumento ng katiwalian," said Aquino. 5. Any congressman's project will be limited to his or her district. 6. The government will continue and strengthen a transparent bidding for every project, with every bid notice and award placed on the Philippine Government Electronic Procurement System o PhilGEPS. 7. The public should have continued access to project implementations through budget department and several other agencies. RECOMMENDATION I recommend that the Priority Development Assistance Fund(PDAF) or pork barrel must be abolished. Due to the pork barrel scam of Janet Lim Napoles, it must be abolished because these funds must go to people of the Philippines not only just in the pocket of this scammers. I admit that there have been abuses committed by some lawmakers and, because of this, I agree with calls to abolish the pork barrel in order to regain the people's trust in our institutions.

BIR wants online sellers to pay taxes MANILA, Philippines - The Bureau of Internal Revenue (BIR) said it will start collecting taxes from individuals and businesses selling products online as part of its aggressive efforts to meet collection goal and boost government revenues. The BIR issued a new memorandum which reiterates online sellers obligation to pay taxes. Citing the National Internal Revenue Code, Internal Revenue commissioner Kim Henares said failure of online sellers to register with the BIR would result in the imposition of appropriate penalties. Henares said the law requires the issuance of receipts by online sellers for every sale of goods and properties or exchange of service. The receipt must bear the full amount of the sale to the buyer. Under the rules, online sellers must secure the required Authority to Print (ATP) invoices and register books of accounts for use in business either manually or electronically. The receipt, the BIR said, must be prepared at least in duplicate, the original to be given to the buyer and the duplicate to be retained by the seller as part of the latters accounting records. Online sellers are also required to file and pay applicable tax returns on or before the due dates as well as submit a summary list of sales/purchases including the payees. Henares said the existing tax laws and revenue issuances on the tax treatment of purchases (local or international) of goods (tangible or not) shall apply to all transactions wherein consumers directly buy goods or services from a seller and an intermediary or third party over the Internet. Therefore, those using online social networks such as Facebook must register as a taxpayer. Among the popular online buy and sell websites include sulit.com.ph, ayosdito.ph, alibaba.com, and tsikot.com, etc. Also covered by the rules are those that use the Internet to deliver marketing messages to attract potential buyers and those that conduct online auctions (such as ebay.ph). Aside from issuing official receipts, online merchants or retailers are mandated to issue acknowledgement receipt to the credit card company or payment gateways for the amount received. They must also pay the commission of credit card company net of 10 percent expanded withholding tax. Payment gateways which refer to banks, credit card companies, financial institutions and bill paying services are similarly required to issue validated bank deposit slips in the name of the merchant or intermediary and remit the amount to the merchant less EWT of one half of one percent. Freight forwarders and online website administrators are likewise required to issue the BIR registered OR for the service fees paid by the merchant or advertisers. According to the BIR, the merchant/retailer is obliged to pay the online advertising entity for the advertising fee, net of two percent EWT. Source: http://www.philstar.com/business/2013/08/24/1126961/bir-wants-online-sellers-pay-taxes

FACTS OR PROBLEMS The Philippines' Bureau of Internal Revenue (BIR) has issued a memorandum in which it confirms that, as allowed for in the country's tax code, it will start collecting taxes from individuals and businesses selling products online. Online sellers will also need to withhold the required creditable/expanded withholding tax, final tax, tax on compensation of employees, and other withholding taxes, and remit the

revenue collected to the BIR, having issued to their customers the necessary Certificate of Tax Withheld. They must file tax returns on or before the due dates, pay the correct taxes, and submit information returns and other tax compliance reports, such as the Summary List of Sales/Purchases, as required by existing rules and regulations.

ALTERNATIVES It is now time to put or to collect taxes among the online entrepreneurs to be fair to other entrepreneurs because they are also paying their taxes. Also, the tax that will be collected can add to Philippines tax revenue. Like any other business establishments, individuals or businesses who conduct business through online transactions and its permutations have the obligation to register at their Revenue District Office and pay a registration fee. A BIR Certificate of Registration will be issued, reflecting the tax types required to be filed and paid by the relevant taxpayer.

CONCLUSION The Philippines Bureau of Internal Revenue (BIR) Commissioner Kim Henares has disclosed that individuals, small business owners and self-employed individuals can expect to be able to file their income tax returns online from April next year. The target of the BIR are the online sites that really do selling as a business. Not those, for example you have a bag and you want to sell it. Government should help promote online industry, Tax them when their capable enough. hitting tax at this premature stage will just make entrepreneurs setback, trash perspective and total nonsense. Tax is simply their POLITE way taking people's money and gauge their 2013 special revenues.

RECOMMENDATION To increase its revenue collection, first the Aquino regime came to tax the countrys sin industries and companies. Its always safe to denounce the rich and the successful industries that destroy peoples health. The government might target any of the following tax options next :

Tax on telecommunication companies and their related services (e.g., texts, calls, etc.) Tax on blogging and other related social network activities. Tax on e-selling or any other money-making ventures or activities online. Tax on other internet ventures or activities. Tax on mining companies. Tax on government benefits and insurance. Tax on OFWs. Remember that tax is defined as a fee charged (levied) by a government on a product, income, or activity.. More taxes on the industries companies run by oligarchs who support the system. Imposition of more or higher regulatory fees and payments. Any kinds of processing, permits, application fees, etc. that we pay to the government (e.g., NBI clearance, LTO permits, among many others). If the government provides you contraceptives and family planning services you need, it would be justified and empowered to tell you how to plan your family and to take away your rights and the rights of others (e.g., employers, doctors, etc.).

Why land reform is slow in PH

By Kathlyn dela Cruz, ABS-CBNnews.com Posted at 02/08/2013 7:51 PM | Updated as of 02/08/2013 8:13 PM MANILA, Philippines -- Agrarian Reform Secretary Virgilio delos Reyes on Friday said it is "grossly unfair" to say that his department is slow in distributing lands to farmer beneficiaries under the Comprehensive Agrarian Reform Program (CARP). His statement comes after Catholic bishops called for his resignation due to DAR's alleged slow action. In an interview with ANC's "Headstart," delos Reyes said it is unfair to compare DAR's performance under his leadership with the previous administrations. He said: "In previous decades, we have been distributing government-owned lands and those which are done by way of voluntary land transfer. That is very easy. The government owns the land; you put a title; you distribute it. And those which are done by voluntary land transfer, there is already an agreement between the land owner and beneficiary then you give it. No problem. No conflict." He noted that around 60 percent of the lands that have been distributed by DAR for the past 20 years has been under that mode. "Only 7 percent was done under compulsory acquisition which means the owner does not want to give it; he's not going to cooperate; he has a title; you have to pay him and then you transfer it to the beneficiary," delos Reyes said. "So when you compare to the past, I think it's grossly unfair," he continued. Land record problems, missing land titles Many other factors hamper the government's move to fast-track land reform. These include problems in land records and missing land titles. He said these problems have been around even before he headed the agency. Delos Reyes said in 2011, just months after he joined DAR, they had to "exhume" about 45,000 folders of land titles and make an inventory of the lands that they are to distribute. "About 45,000 folders in the entire country were exhumed. Yes, they were literally buried. We took them; we opened them. We got all the employees; we hired extra people, put them in hotels and began to open all folders," he said. The secretary also claimed that as early as 2012, he already admitted to the Catholic bishops that DAR would not be able to finish the land distribution by 2014, which is the time the law expires. '2014 is a false deadline' Delos Reyes said one reason why bishops continue to criticize him is because they are "misinformed" on the law. Contrary to the fear of some bishops that distribution will stop once the law expires in June 30, 2014, he claimed it can continue beyond 2014. "The problem with the target set by many people, including the bishops who I believe have been misinformed, is that they have set 2014 as the deadline for complete land distribution," he said. "The bishops were heavily involved in pushing for this law that we have right now and I'd like to call their attention to Section 30 of the same law that they had a big hand in pushing...which says if there is an open case by June 30, 2014 which is the deadline, it means it can go beyond June 30, 2014." "2014 is really a false deadline... It's like December 21, 2012 -- it's not the end of the world," he added. Delos Reyes said he is ready to have a dialogue with his critics to help them see the situation in a "different light."

"I'm prepared to face you and to talk to you about what is really happening. I am prepared that if you want to visit our offices all over the province and examine the record that we have, perhaps you might see a different light," he said. He also addressed the bishops' concern that DAR should extend more services to farmers. Delos Reyes said that aside from the agency's land distribution, the Department of Agriculture is also helping and guiding the farmers in what they should do with their lands. "So that when a farmer makes a decision, his option to make money or improve his life through that land should be there," he said. Source: http://www.abs-cbnnews.com/nation/02/08/13/why-land-reform-slow-ph

FACTS OR PROBLEMS Agrarian Reform Secretary Virgilio delos Reyes on Friday said it is "grossly unfair" to say that his department is slow in distributing lands to farmer beneficiaries under the Comprehensive Agrarian Reform Program (CARP). His statement comes after Catholic bishops called for his resignation due to DAR's alleged slow action. In an interview with ANC's "Headstart," delos Reyes said it is unfair to compare DAR's performance under his leadership with the previous administrations. He said: "In previous decades, we have been distributing government-owned lands and those which are done by way of voluntary land transfer. That is very easy. The government owns the land; you put a title; you distribute it. And those which are done by voluntary land transfer, there is already an agreement between the land owner and beneficiary then you give it. No problem. No conflict." He noted that around 60 percent of the lands that have been distributed by DAR for the past 20 years has been under that mode. "Only 7 percent was done under compulsory acquisition which means the owner does not want to give it; he's not going to cooperate; he has a title; you have to pay him and then you transfer it to the beneficiary," delos Reyes said. "So when you compare to the past, I think it's grossly unfair," he continued.

ALTERNATIVES/ RECOMMENDATION What we direly needed in this developing country in answer to the many centuries of yearning and entreaty to improve the lot of the man in the plow, is an iron-fisted implementation of these laws, a kind of sincere leadershipin implementing the so called centerpiece program of the present dispensation that is farmer-oriented and will not succumb to the senseless demands of pressure groups.

CONCLUSION If we must endeavor to successfully implement and apply the provisions of the CARP, it is essential that the student of law should have substantial knowledge in the application and interpretationof the earlier enactments on agrarian reform. But be that as it may, man-made laws are often beliitled by the implementers as inadequate in providing satisfactory solutions to multifarious agrarian problems. And the present CARP is no exception to this observation.