POSTSCRIPT / August 17, 2006 / Thursday

By FEDERICO D. PASCUAL JR.

Philippine STAR Columnist

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Anti-terror bill: Weigh security against liberty

STATE POWERS: There is a need, but I see no urgency, for the Anti-Terrorism Act.

As we have been witnessing lately, President Gloria Arroyo — or more precisely “the state” — has sufficient powers, not to mention its bag of extra-judicial tricks, to crack down on terrorists and whoever dares to disturb the peace.

Witness the unabated serial assassination of persons identified with groups that the military or the government in general has labeled as leftist, radical, terrorist or subversive.

The more plausible reason why Ms Arroyo wants the anti-terrorism bill passed posthaste is that Uncle Sam wants it. It is not because Filipinos want or need it more urgently than they do food, jobs, health and education.

President Arroyo is very concerned about maintaining (or recovering, depending on one’s viewpoint) her standing in the coalition of those willing to do the bidding of President George W. Bush in his crusade against Evil on Earth.

Legislators who want Gloria to remain in, or return to, the graces of Dubya, better pass the anti-terrorism bill pronto without changing a word or punctuation in it, while her detractors try blocking or mangling the measure with all their might.

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STOP EXECUTIONS: Senate Minority Leader Aquilino “Nene” Pimentel (PDP-Laban) has added an interesting angle to the legislative debate over the anti-terrorism measure.

If the Arroyo administration wants the bill passed, he said, “the President must first make good her pledge to stop extra-judicial killings of political activists and journalists and other violations of human rights.”

He conceded that legislation is needed to combat the sophisticated methods that terrorists now use to harm the innocent.

“But while the administration has not shown sincerity and determination to solve political killings and prevent them from recurring especially where soldiers and policemen have been tagged as the perpetrators,” he said, “it is unwise to approve this bill.”

The bill should not be passed, he added, as long as it is not clear how President Arroyo will use the Anti-Terrorism Act.

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TERMS DEFINED: The bill defines terrorism as “the premeditated, threatened and actual use of violence or force or by any other means of destruction perpetrated against persons, properties, or the environment, with the intention of creating or sowing a state of danger, panic, fear, or chaos in the general public, group of persons, or segment thereof, or coercing or intimidating the government to do or abstain from doing an act.”

Terrorism as defined includes: “threatening, or causing, serious unlawful interference with or serious unlawful disruption of an essential service, facility or system; hijacking any kind of aircraft or any means of mass transportation; threatening to kidnap or deprive a person of his liberty.”

There is “conspiracy” to commit terrorism when persons agree to commit terrorism as defined. There is a “proposal” to commit terrorism “when any person who had decided to commit an act of terrorism proposes its execution to some other person or persons.”

Acts that “aid” terrorism include “harboring or concealing any person whom one has reasonable ground to believe has committed an act of terrorism” and “failing to disclose acts of terrorism.”

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TERROR VS TERROR: Former ambassador Rodolfo A. Arizala, who shared with us the above footnotes to the anti-terrorism bill, said there is “an urgent need for vigilance that the rule of law predominates” by enacting laws to prevent or eradicate terrorism.

The key word in the bill, he said, is “fear.” Mere intent, threat, concealment or failure to disclose acts of terrorism is punishable under the measure.

Arizala said: “A person caught in possession of explosives or dynamite which he intends to use in catching fish, is likely to be prosecuted not for illegal possession of explosives or for using dynamite in fishing but for terrorism.

“A person or group of persons who hijacked a passenger bus to rob its passengers would not be charged with ‘highway robbery or robbery in band’ but with terrorism. A bystander who fails to report or disclose that terrorism has been committed can be prosecuted for terrorism.”

Noting that the definition of terrorism under the bill is “all-embracing,” Arizala said: “To fight terrorism, it appears we are also using terror or fear. It is terror versus terror.”

Instead of a “balance of terror,” he suggested, there must be a balance between “security and liberty.”

We can win the hearts and minds of people in support of any measure to combat terrorism, he said, by “protecting liberties and safeguarding fundamental human rights.”

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BIR TARGETS: For the first six months this year, the Bureau of Internal Revenue collected P302.028 billion, exceeding the goal of P300.877 billion by P1.151 billion..

BIR Commissioner Jose Mario Buñag and BIR personnel surpassed the target despite the distraction of endless carping and grousing around them.

Any single month when the collection slides, critics descend on the BIR. They ignore the fact that since the tax goal is fixed for the fiscal year, it is at the end of this period that performance should be judged.

As it happens, a shortfall can be made up in the next month or the following months. There is a leveling up at the end of the fiscal year.

Other points that are sometimes glossed over are that (1) tax collection is dependent on the state of the economy, which has its ups and downs, and that (2) collection targets could be unrealistic.

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NO CRYSTAL BALLS: Take a look at the withholding and documentary stamp taxes imposed on treasury bills and bonds.

These tasks are under the full control and supervision of the Bureau of Treasury, which issues the bonds and collects the taxes due. Is it not unfair then to blame the BIR if the taxes due from these instruments fall below the target fixed by those who drew up the budget?

For the first semester of this year, the treasury bureau collected only P16.363 billion in withholding and documentary stamp taxes due from treasury bills and bonds, incurring a shortfall of P3.985 billion.

Considering that the sale of treasury bills depends on the fickle demand in the money market, it would also be unfair to blame treasury officials for the shortfall.

What conceivably happened was that budget officials miscalculated the market demand, at least for the past six months. But those things happen since budgetary officials are not equipped with failsafe crystal balls.

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VARIABLES: Judging tax collection performance on a monthly basis is a futile and misleading exercise. The best measure is the bottom line at the end of the taxable year.

To illustrate: Major taxes such as the value-added tax and the corporate income tax are not reconciled on a monthly basis. The VAT has a quarterly reconciliation schedule, while the corporate income tax is reconciled annually.

Many variables affect tax collection aside from the state of the economy and the taxpayers’ mood.

We have noticed, for instance, that businesses that are not confident of hitting their sales target for the month usually tend to declare conservative sales revenues, consequently driving their VAT payments down for the month.

It is at the end of the quarter when they are required to reconcile their VAT obligations that they have occasion to pay the correct tax, which sometimes even exceed their own fearful expectations.

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CROSSING BRIDGE: On the other hand, while corporations make income tax payments quarterly, or actually 60 days after every quarter, their payments are based only on estimates of net income.

Their actual net income is reflected only in the annual income tax return which is due in April of the following year. It is only then that actual corporate income tax payments can be accurately measured.

Most quarterly income tax payments, I was told, are made on “gut feel” and not on actual net income which can be determined only at the end of the fiscal year.

This explains the monthly fluctuations of tax payments. We have to consider payment cycles and taxpayer behavior to have a more accurate and fairer appreciation of tax collection performance.

Harping on “shortfalls” on a per-month basis is like crossing a bridge before reaching it, or kicking a cow to yield milk even though it is not yet lactating.

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(First published in the Philippine STAR of August 17, 2006)

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