As it is, discussions on the mechanics of how the pork barrel scam was perpetrated outlines the massive collusion between the executive branch of government, the legislative branch of government, members of the supposedly independent constitutional body that is supposed to keep corruption in check, and pork barrel “operators”.
At this point, calling for a shift to a form of government where Executive and Legislative powers and functions are in fact FUSED may appear sublimely ignorant of the real issues at play and would actually be a call to WORSEN the situation instead of improving it.
Right now, calls for a shift to a parliamentary form of government is a useless distraction from the main issues which are CORRUPTION and WASTEFUL GOVERNMENT SPENDING — both of which can happen and is happening regardless of the form of government.
What the pork barrrel scam underscores is that even with all the safeguards in place, a substantial percentage of any money given to the government will end up stolen or wasted.
Instead of a fancy info-graphic which seems to the “hip” and fancy way of referring to a diagrams these days, allow me to express this with a simple sentence: Any amount of money you give to the government will result in a portion of it being stolen or wasted.
So, rationally and logically, the less money you give government the less there will be to steal and waste.
Fellow Marikina City dweller Sen. Koko Pimentel actually expressed the same idea better in a conversation in 2011, “The best policy I can think of is to keep as much money in the pockets of those who can spend it wisest and with greatest effect. You the tax payer.”
The thing is countries with parliamentary systems dominate the list of countries with the highest tax burdens, see BongV’s diagram here. (You may also want to read Bong V’s post on well-researched and easy to understand article “Shifting to Parliamentary System Is not a Pre-Requisite to Economic Liberalization”)
Moreover, if you are calling for “evolving federalization” or federalism, you are actually multiplying the number of taxes you will have to pay. This is because not only will you be paying taxes to support your state, you will also have to pay another tax to your federal government.
The result? Well, that’s more of your money stolen and wasted.
So, what do we do now?
Calling for the scrapping of the pork barrel system eliminates just one of the many items of the government’s budget which results in waste and money being stolen. The thing is we can’t trust our senators and congressmen to completely scrap the pork barrel system and I don’t think it would be feasible for ordinary income tax payers to go through each item of the government’s budget documents or the GAA (which I am told is actually six books, each about two and a half feed thick) and ferret out other forms of discretionary funding similar to the pork barrel. So, rather than go after the long list of ‘terminal points”, I think it’s much simpler and easier to reduce tax revenue theft and waste at its source: the taxes we pay.
Mon Abrea, a columnist at the Manila Bulletin and president of the Center for Strategic Reforms of the Philippines (CSR Philippines) as well as the Chief Strategy Officer of the country’s first social consulting enterprise, the Abrea Consulting Group (ACG), came up with a couple of directions that seem worthy of pursuing.
Here is an excerpt from Abrea’s column titled “Please Save Us From Despair”
What our legislators should be doing instead of making soft and infrastructure projects is to revisit the tax code and make two possible amendments in favor of our employees: first,provide a separate income tax table for employees, with lesser and reasonable tax rates; and second, increase the personal and additional exemptions to at least P200,000 and P50,000 for each qualified child, without limit as to the number of dependents, respectively.
Our tax code provides no incentive to our employees. Given their limited capacity to earn, their compensation is subject to the same income tax rates for sole proprietors and professionals without the benefit of deductible expenses. This is another reason why we should encourage our people to become entrepreneurs.
What are these deductible expenses? These pertain to those expenditures that a taxpayer incurs in relation to the conduct of his business or profession. These cannot be availed of by individuals earning purely compensation income as a result of an employer-employee relationship because they are not engaged in any business or practice of profession.
Our tax laws provide two ways of deducting expenses from gross income. The first is the optional standard deduction (OSD), which is equivalent to an amount not exceeding 40 percent of the gross sales or receipts. This must be elected by the taxpayer when filing an income tax return. The second way is deducting through the itemized deductions, which include among others, expenses in general, interest, taxes, losses, bad debts, depreciation, charitable and other contributions and premium payment on heath and/or hospitalization insurance of an individual taxpayer.
Apart from the block-quoted excerpts from Abrea’s column, he also batted for the Flat Tax Rate — which is a topic that I am still studying at this point.
What Abrea said in his column regarding deductible expenses actually led me to consider the possibility of recommending that salaried employees opt to become “consultants” or “service contractors” of their companies — if such an option were possible.
One warning from a friend whom I consulted about this idea, however, says that the price for doing this will be either doing a ton of paper work every month or having to pay someone to do it.
Anyway, in as far as proposing a viable and immediately implementable solution to the pork barrel mess, looking at our taxes seems ot be the better and more direct way to go than the Ruben Goldberg theory of solving the pork barrel mess.
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