Congress Fails to Pass VAT
Despite special sessions, Congress still failed to pass the bill restructuring the value-added tax (VAT) system. Members of the Senate wrapped up their interpellations and committee amendments as Congress formally adjourned its three-day special session last 1 April.
The Executive has been seeking the passage of the bill in a bid to collect some P50 to P70 billion from increased VAT proceeds. Senate President Franklin M. Drilon said Senators reached a consensus on the last day of the special session that the VAT rate would be retained at 10%, but they have yet to agree on individual amendments or put to a vote provisions lifting the VAT exemption on fuel and power once Congress resumes regular session on 11 April.
With the House and Senate versions of the VAT bill still vastly different from each other, there’s no telling now how long Congress will take to reconcile their versions and pass the bill.
About the only accomplishments of the special sessions were the passage of two bills on third and final reading to reset the Barangay and Sangguniang Kabataan elections (HB 3742) and to extend the utilization period of the Agricultural Competitive Enhancement Fund (HB 3740). Both measures were included in the President’s call for the special sessions. Aside from the expanded VAT measure, the President asked for action on bills to strengthen anti-smuggling programs and a law appropriating funds for the conduct of elections in the Autonomous Region in Muslim Mindanao (ARMM).
GMA Approves 2005 Budget
President Gloria Macapagal-Arroyo signed the General Appropriations Act (GAA) of 2005 (RA 9336) into law on 16 March without exercising her line item veto powers, a first in recent history. The new budget totals P907.6 billion or 5.3% higher than the government’s actual spending for the previous year which amounted to P861.6 billion. In passing the bill, there was a brief altercation between both chambers of Congress as the Senate approved the House version in toto to prevent any attempt by congressmen to increase their pork barrel funds at the bicameral committee hearings. Leaders of both houses of Congress have since mended their fences.
Under RA 9336, legislators still have P6.1 billion in Priority Development Assistance Funds to share, a 26.7% cut from last year’s P8.33 billion. The Department of Budget and Management’s PDAF release for FY 2003 show that Representatives were allocated a maximum of P20 million each while Senators were allowed to charge P50 million worth of PDAF projects, for a total of P6.17 billion. Using the same figures, with the present composition of Congress totaling 235 representatives and 23 senators, the government would have to pay out P6.62 billion in order to give each legislator his PDAF allocation. Some legislators such as Sen. Panfilo M. Lacson have already announced that they would not touch their pork barrel this year.
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