Taxation without representation

Within two months from now, responsible Filipinos from all walks of life will perform two fundamental responsibilities of citizenship, the first being the payment of income tax on or before April 15, 2007; the second being the election of our national and local leaders in May 14.

Rather than discuss technical issues regarding taxes, this column steps back a bit to discuss the concept of taxation and how this relates to our other fundamental obligation of electing our country’s leaders.

These twin events bring to mind the phrase “taxation without representation” which first came about during the American Revolution to denote the complaint that taxes were imposed by the British government without the consent of the American colonists since the colonists had no representation in the British Parliament.
Taxes have always been defined as the “lifeblood” of a government, the primary purpose of which is “to generate funds for the State to finance the needs of the citizenry and to advance the common weal.” (Philippine Bank of Communications v. Commissioner of Internal Revenue, et al., GR No. 119024 [1999]).

Logically therefore, we expect to see the effects of the taxes we pay in government infrastructures and the actual services rendered by both the national and local governments.

Taxation has always been a legislative power, although the role of the executive branch is very important considering that the latter administers not only the collection of taxes, but more importantly, how the taxes are utilized for the delivery of government services.

Thus, it is important for us, as taxpayers, to see to it that we elect deserving officials (at both the legislative and executive branches) who will undertake the fiduciary responsibility of administering properly the taxes we pay for the needs of the government.

If we abdicate this responsibility by: 1) not exercising our obligation (and not merely a right) to vote; 2) not voting the right officials for the position; and 3) not protecting the sanctity of the voting process by not ensuring that the votes are properly counted and all forms of cheating and tampering with the election process are prevented, then, we lose the only control we have in ensuring that our taxes are used properly. We only, then, have ourselves to blame in the process if we abdicate this responsibility.

To this end, law-abiding citizens cannot claim that this is merely wishful thinking since if we have just several law-abiding citizens per barangay protecting the electoral process, then this will go a long way in ensuring the sanctity of the process. In this respect, we can spend a lot of money doing other socially relevant activities but if we fail at this basic cornerstone of our democratic process, then all such measures become merely palliative in character.

Corollarily, we should pay the correct amount of taxes on time so that vital government functions are not suspended by the lack of funds.

We can not continuously complain about the failure of government to provide basic services if we do not supply the funds needed by government. Neither can we continuously hide behind the argument that we refuse to pay the correct taxes since such will not be used properly anyway.

The obligation to pay taxes (viewed against the government responsibility to provide services) should not be a “chicken and egg” situation. We should pay our taxes correctly and promptly, period.

Moreover, this obligation does not rest only with salaried employees, where the lowest tax leakage arises because of the withholding tax system. It rests with every Filipino from all levels of society, from the sidewalk vendor to the big businessman, as each of us pays taxes in one form or the other, such as income tax, value-added tax, excise tax and documentary stamp tax, among others.

Filipinos cannot short-cut the approach to the payment of taxes and later on raise issues against insufficient and inferior government services, as we cannot come to the court of public opinion with “clean hands”.

The obligation to pay taxes and the right to representation via the right of suffrage are intertwined concepts that denote the reciprocal rights and obligations of the citizen towards the State.

We cannot abdicate our responsibilities toward the State on the payment of taxes (like the payment of our income taxes on or before April 15), notwithstanding the government’s apparent and perceived failures in the provisioning of basic services.

We have an opportunity, however, to ensure that the taxes we pay are used properly and responsibly through our right to vote the qualified leaders of our country; that opportunity has to be properly and diligently exercised and more importantly protected.