May 24, 2021
Senator Aquilino Pimentel III
Chair, Senate Committee on Trade, Commerce
Congressman John Rey Tiangco
Chair, House Committee on Trade and Industry
Subject: On indirect taxes like safeguard duty, dumping duty, import duties
Dear Senator Pimentel and Congressman Tiangco
Our consumer group, Laban Konsyumer Inc. is respectfully submitting a proposal that will stop passing on to the consumers the indirect taxes imposed on certain business such as safeguard and dumping duties and higher duties on imported cement , ceramic tiles , vehicles rice and meat products.
Under existing tax laws and cases, the liability for the payment of the indirect taxes fall on one person, the statutory taxpayer, however, the burden thereof can be shifted and passed on to another person, such as the tax is imposed upon the goods before reaching the consumers who ultimately pay for it as part of the purchase price . In this event, the consumer pays more for the goods.
The current tax laws and cases on indirect tax laws defeat the objective of imposing duties on imported rice, meat products, cement, ceramic tiles and vehicles. In any event, the indirect taxes are shifted and the burden passed on to the consumers ( PAL vs. Commissioner of Internal Revenue, G.R. No. 198759, July 1, 2013 ).
We propose that Congress introduce amendments to the shifting process and stop the passing on the tax burden to the consumers. We also need to prevent windfall profits of the statutory taxpayer in the event of a favorable appeal and a refund .
Thank you very much.
Very truly yours,
Atty. Victorio Mario A. Dimagiba, AB, LLB, LLM