ABS-CBN News: Telco franchise tax nixed, VAT hike eyed
On the hyperlinked news report above from ABS-CBN News Palawan Congressman Abraham Mitra of the Liberal Party challenged the mobile phone companies in the Philippines to accept per pulse (every 6 second) billing if they do not want to accept the proposed franchise tax.
Mr. Mitra said that the franchise tax measure was an indirect method to recover the billions of pesos earned by cellphone companies from their per minute charging. You see when your voice call over a mobile phone in the Philippines lasts for only one minute and one second you will be charged for the the second minute that you have not completely used. [Last year Vodafone New Zealand and Telecom Mobile changed its tariff system so now a caller will only have to pay for the first whole minute and then charged per second.]
It would be recalled that the cash strapped Philippine central government is urging the passage of additional tax measures to generate more funds. One of these measures is a proposed franchise tax to telcos which the industry strongly refuse.
Moreover, the government of Mrs. Arroyo is thinking of increasing the Value Added Tax from 10 to 11 percent.
When asked about the planned increase in taxes my mother always say that she would not mind paying a little more. She believes that so long as the tax will not end up under private bank accounts of public officials it is a little sacrifice for the public good.