Letter to House Ways and Means and Trade and Senate Trade committees


 May 24, 2021

Senator Aquilino  Pimentel III

Chair, Senate Committee on Trade, Commerce

 and Entrepreneurship

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


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