Kiko Barzaga proposes scrapping of 12% VAT

A bill scrapping the imposition of the 12% Value-Added Tax (VAT) on all goods and services has been proposed in the House of Representatives.

Cavite 4th District Rep. Francisco “Kiko” Barzaga made the proposal under House Bill 5119 that he filed on Monday.  

“VAT places the greatest burden on ordinary consumers particularly low- and middle-come families, as it is imposed on goods and services regardless of the ability to pay,” Barzaga said in his bill’s explanatory note.

“With the rising cost of living, inflationary pressures, and widespread calls for lax forms that promote equity and social justice, it is imperative for Congress to revisit the VAT system. This measure seeks to abolish VAT by reducing its rate from 12% to 0%, thereby relieving the tax burden on Filipino consumers and enhancing their purchasing power,” Barzaga added.

To compensate for the loss of government revenue with the scrapping of the 12% VAT, Barzaga said he will file measures proposing a “more progressive, fair, and sustainable” taxation.

Some of the other pending bills seeking to remove imposition of VAT include: 

• House Bill 39, which seeks to exempt the electric bill of senior citizens from VAT imposition
• House Bill 84, which seeks to exempt the electric bill of households consuming 200 kilowatt per hour or less from VAT imposition
• House Bill 889, which seeks to exempt drugs and medicines for mental health from VAT imposition
• House Bill 1364, which seeks to exempt generic and branded medicines from VAT imposition, and
• House Bill 3711, which seeks to exempt senior citizens from paying VAT for fuel products.

— JMA, GMA Integrated News