Holy Tax!

Tuesday, 26 April 2011 10:40

Written by Louie C. Montemar

The State, like Holy Week, is a practice and abstraction imposed, initially, on Philippine society by colonialism. Whatever political color one wears in the Philippines, whether one likes it or not, one simply has got to contend with the reality that is the Philippine state (and Holy Week) and its power to tax.

There is, however, some confusion about what exactly the state is, especially if one takes earnestly propositions about it by the more militant civil society groups who are fond of crying “Ibagsak ang Estado!” To my mind, the most useful conceptualization of the state would be the one that views it as nothing but an organization—one that exists in society among many other kinds of organizations; society being a mixture or “melange of various social organizations” as Joel Migdal would put it.

As an organization, it has its leadership and membership structures and one finds in it leaders and personnel in its offices and agencies who comprise the bureaucratic structure known as “government.” Formally, membership in a state, is referred to as “citizenship.” To be a good citizen, at least formally, means following the rules which, among others, define the relation between government and the broad citizenry—such as those on taxation.

In political sociologist Migdal’s way of describing the state, these rules and the state's actual exercise of power define its four key capacities: the capacity to penetrate society, extract resources from society, regulate social relations, and allocate resources in society.

From these capacities or functions, one can more clearly see beyond the triviality of formal structure and note that the state is unlike all other organizations, particularly in the magnitude and quality of power that it possesses. To live up to its role and functions, the state is that organization which has effectively been granted the right to wield violence if necessary. It is, as the case of China exemplifies, that organization that could and would allegedly take away life with no compunction in the interest of, supposedly, society in general.

In another sense, its functions indicate a more subtle “power to create and destroy,” that is, in its capacity to extract resources from other societal actors. Concretely, the most common form such “extraction” takes today is taxation.

In 1819, Lawyer and American Senator Daniel Webster argued a case in the US Supreme Court (McCulloch v. Maryland) and is reported to have articulated one of the most oft quoted lines regarding taxation as a function of the state. He posited: “An unlimited power to tax involves, necessarily, a power to destroy.” In the decision of Chief Justice Marshall on said case, it was thus set: “That the power of taxing it [the bank] by the States may be exercised so as to destroy it, is too obvious to be denied,” and “That the power to tax involves the power to destroy … [is] not to be denied.”

The Holy Week should have also reminded us of such power to destroy and take away life. Crucifixion, after all, was just one of the peculiar forms by which the Roman state tried to impose order in its provinces at the time of the historical Jesus. Crucifixion was, in fact, state capital punishment for political offenders like the men of Spartacus and, yes, Jesus.

Today, we sense some enthusiasm in in the Philippine state's flexing of its political power in the matter of taxation. All the taxi, tricycle and sidecar drivers I have asked on the issue are hungry for the proverbial blood. But this time the alleged political criminal, as it were, is no Son of Man, but of Woman (pun intended, but pardon the tinge of blasphemy), particularly the son of GMA.

The BIR charged Ang Galing Pinoy Party List Representative Juan Miguel "Mikey" M. Arroyo for failing to pay taxes totalling P73.85 million. Mr. Arroyo, according to government tax officers, did not file ITRs in 2005, 2008 and 2009.

The Arroyo son is crying political harassment. But no, dear Representative, that is not harassment. Mind you, even Brazilian celebrity Daiana A. Menezes of noontime TV show Eat Bulaga-fame has been charged for not filing her ITRs for three years, despite being required to do so under the law as a resident alien. That is simply, exquisitely, the cold power that is the State. If found guilty, these alleged tax evaders will have to bear their cross.

Representative Arroyo should find small comfort in the fact that his case will not be decided by the public and that the dictum of Vox populi, vox Dei is not taken literally. For if marginalized peoples were to decide—including the tricycle drivers and security guards that Representative Arroyo's Ang Galing Party list group supposedly represents—imprisonment might even be too light a sanction for his alleged trespasses.

Anne Robert Jacques Turgot has proposed that: “The expenses of government, having for their object the interest of all, should be borne by everyone, and the more a man enjoys the advantages of society, the more he ought to hold himself honored in contributing to those expenses.” The question now hangs, has this Representative of the nation's security guards and tricycle drivers contributed and proportionately as Turgot suggests?

As one tricycle driver succinctly and sarcastically remarked when I asked him what he thinks of government's case against Rep. Arroyo: “Ang galing, P'noy!” Let's see. But, really, it is the people, not the Governor, who may choose to wash their hands on this one.

Come to think of it, you want to even things up a bit Mr. Representative? Here's a suggestion. File a bill now that makes stricter and more effective taxation on high-earning professionals like doctors and lawyers. Look, I have observed and tapped the professional service of countless medical doctors and lawyers. None of them ever gave me or anyone I know a receipt for their services. We don't see these well-dressed practitioners with a sign on them like in business establishments reminding us customers and clients “Always ask for an official receipt (OR).” Never have I seen an “OR” signed by those officers of the court or those disciples of Hippocrates. Never. So how exactly, pray tell, does the state assess their incomes and determine their attendant tax obligations? Pardon what may sound to some as my naivete on real taxation systems in our country, but I sense something unsettling here.

This reminds me of another unsettling learning moment which I experienced when I once lined up to pay my resident tax at the Manila City Hall. Knowing how much I earned the past year and how much I am duty-bound to pay as resident of Manila for what others still call the “cedula,” I gave the person behind the service window something around two hundred pesos. Apparently surprised at the sum I was paying, the woman politely asked, “Sir, ano ba trabaho ninyo?” [Sir, what is your occupation?] I proudly replied, “Teacher po” [I am a teacher]. The woman's smirk sent me the message before her words, “Teacher lang pala. Ten pesos lang, okay na.” [Just a teacher. Ten pesos is enough.] I wanted to exclaim, “Holy tax! Here I am volunteering to pay the proper tax, and I am told that I am just a teacher!” Who was I to argue? I am just a teacher.

So Mr. Representative, you may also want to exempt all of us poor teachers from income taxation in that bill. Holy tax, you will certainly get my support on that!

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