NEW TAX LAWS WILL NOT CURE OUR BUDGET DEFICITS

"BIR posts P197.8-billion budget surplus in April" -- news!  Ala eh, para sa akin, that is not news.  Hindi ba, such surpluses do happen come April every year, and for the very simple reason that we all pay our annual income taxes on April 15 each year.  This is no reason for the BIR to boast off.

As a matter of fact, even with that surplus, the government still had recorded a cumulative collection deficit of P2.9 billion for the period Jan to April.  So, that P2.9 budget will be added to the total budget for the year, and the sum will be what the government must collect for the period May to December. 

Again, sa isang bagong tax measure na naman nakatutok ang paningin ng BIR.  I mean, the new Sin Tax measure now in Congress.  But at best the proceeds from this new tax legislation will yet be collected next year, assuming it is passed this year.  Then, that Sin Tax proceeds will be added to the new tax budget na kailangang bunuin in 2013.  Aba, eh, paano na tayo makaka-ahon sa ating annual collection deficit.

Ergo, my thesis is:  New tax measures have never, and will never, retrieve us from annual budget deficit. Lagi na lang bagong buwis ang solusyon natin dito, pero taon-taon budget deficit pa rin tayo.  Ah, it's high time the gov't had learned of other cures to this problem.

LET THE TRUTH SET THE CJ FREE

Mamayang hapon, at two o'clock, the CJ will testify in his impeachment case.  Kagabi, before I slept, I prayed for him.

I know deep within me that Corona is innocent of the charges against him.  Sa tingin ko, si Corona ay parang isang tao na binato at sinabuyan ng putik ng kanyang mga kalaban, at pagkatapos ay biglang sinigawan: "Marumi ka, alis d'yan!"

Kailan nga ba nagsimula ang lahat ng ito.  Aba, eh, pag-upong-pag-upo ni :PNoy, na galit na galit at hindi naging kanya ang tsansa na mag-appoint ng bagong Chief Justice na kapalit ng nagretirong si former CJ Reynato Puno.  Midnight appointment daw.  Aba'y di nga ba napatunayan na hindi sakop ng midnight appointment ban ang Supreme Court, given the constitutional provision that the President must fill up any vacancy in the Supreme Court within 90 days after its occurence.  As a matter of fact, hindi nga ba't iniatras na ng prosecution ang kanilang charge on "midnight appointment" because they themselves realized that charge would not prosper?  At saka, D'yos ko naman, kung sakali ba'y sino ang nag-violate ng Constitution on the midnight appointment prohibition?  Di ba si Gloria, di naman si Corona.  Bakit kay Corona tayo galit?  Dahil ba hindi na natin puwedeng ipa-impeach si |Gloria?

At any rate, I believe the real truth will come out after Corona's testimony.  In the beginning, the government shouted its voices hoarse into the four winds that Corona had 45 properties not declared in his SALN.  Corona then countered he had only five.  O, di ba napatunatyan nang the prosecutions numbers were a big lie.  Now, the Ombudsman says the CJ had more than $10-million US dollars in the bank, consisting of 82 accounts.  The CJ says that's a "lantern of lies".  I am sure the CJ's testimony will once again reveal the real truth. That truth will set not only the CJ free; but also PNoy's government free from their false accusations from the very outset.

A MAGNIFICENT STRATEGY OF THE CJ'S LAWYERS

Not a few of CJ Corona's detractors are saying his defense team should have not presented the Ombudsman and Risa Hontiveros-Baraquel, et al, because, after all, the prosecutors had rested their case, and that it was incorrect strategy for the defense to have done what they did.  I disagree!  On the contrary, that was a truly spectacular game plan on the defense side.

 It's true that before the Ombudsman's testimony the prosecutors had rested their case, and indeed, at that point in time, there was reason to believe   the prosecution could have yet mustered the 16 votes required to convict Corona.  In my view, PNoy's drum beaters fully realized this grim fact, although they will never admit it.  They had therefore to devise a new way to create some doubts in the public's and the senators' minds on the CJ's guilt or innocence.  And the Ombudsman was the one chosen to do that.  I will bet my three balls -- yes, I have three -- that even the prosecutors would not want to put the Ombudsman on the witness stand, otherwise they would have not allowed the defense to out-race them in that regard. It was enough for the CJ's detractors that the Ombudsman had shouted her unverified charges to the four winds, and thus confuse the public and the judges.  Alam na naman natin ang PNoy, he tends to swallow hook, line and sinker everything that is sensational. It is a matter of plain common sense that if the Ombudsman had not been presented and was allowed to articulate his "lantern of lies" only to the public and the media, the most that Corona's camp could do was to try to refute those charges also before the public and the media.  And that would be not as convincing as to refute those charges before the senator-judges themselves.   

And so, the defense decided to put the Ombudsman under oath, and to let her enumerate her charges one by one.  Those charges, said inside a court of law and not in the arena of public opinion, would then serve the basis for the defense to prove the Ombudsman's unverified charges downright wrong, as the CJ also testifies under oath. .  Actually, the defense's real game plan was to present first Hontiveros-Baraquel et al, and make them admit that none of them had personal knowledge of the bases of their charges, when they filed their respective complaints with the Ombudsman.  With that, the Ombudsman would have been hard-pressed to explain why he outright took those charges hook line and sinker.  A bit unfortunately, however, that original game plan -- meaning Baraquel et al first, then the Ombudsman --did not exactly push  through because Enrile was "atat na atat" to hear the Ombudsman and, thus, ruled that the Ombudsman be presented first.  At any rate, I think it only took some minor adjustments on the line of questioning of the defense lawyers for them to still achieve their original objective.  As things are, the CJ would be in the best position to refute the Ombudsman's charges one by one before a court of law, not of public opinion, and never would she have any chance for a rebuttal.  Indeed, I must congratulate Corona's lawyers for such a very magnificent strategy.

Of course, only God really knows if the CJ had, enough aces under his sleeves. Given his obviously very high spirits, I believe he has,  and will be able to prove, with flying colors, that all of the Ombudsman's charges wrong.  Indeed,  my hopes run high that PNoy and his anti-Corona lapdogs is on for the biggest, and most disappointing, surprise in their lives. 

WHAT MY CRYSTAL BALL TELLS ME

There's no question the Ombudsman's testimony on CJ Corona's dollar account transactions was damning -- although,  methinks, eventually, not as much to Corona as to the integrity of the "conductor" of that well-orchestrated "symphony of lies": PNoy Aquino.  No matter how PNoy denies it, the public has not been born only yesterday not to know that it was upon the President's behest that the House had filed the impeachment case,  which from the very outset was so defective, it started with 8 complaints and ended up in only 3, of which 3, only 1, that on failure to correctly disclose his SALN, has managed to survive, yet inside the ICU at this point in time.  The public also knew from the beginning that the impeachment case was intended not really to impeach the CJ per se,  but merely to force him, by character-assassinating him in the eyes of the public, to voluntarily resign.  This impression should draw clear credence from the alleged 45 properties the prosecutors had originally kept shouting to the four winds the CJ owned but did not declare in his SALN.  What happened next were pure history: - those 45 properties did not really exist, having finally collapsed to just 5 or 6, which in turn were precisely what the CJ had kept saying from day-one as all he owned. The impeachment case, the public also knew from the start, was truly so defective, it started with 8 complaints, eventually reduced to just 3, but of which 3, only one, that on the alleged failure to correctly file his SALN, had managed to survive -- yet clearly in a moribund stage at this point in time.  Alas, if the public essentially realizes all these, the 23 senator-judges are certainly not Marines to be told otherwise about the real score behind the CJ's impeachment.  Of course there are about 3 to 5 amongst them (I need not mention their names, the readers surely know them) who -- pitpitin mo man ang bayag, ika nga -- will vote for conviction on PNoy's behest.  But even these known lapdogs of Pnoy know that their number is miles too far from the 16 votes constitutionally needed to convict the CJ.

The sudden appearance of the Ombudsman to testify on the CJ's alleged money laundering activities is to my mind  the PNoy government's desperate and last-ditch attempt to force the CJ to step down, or alternatively towards the last stretch of the trial,  to create doubts in the minds of the senator-judges regarding his innocence or guilt.  But I am sure not a few bankers had almost died laughing at the Ombudsman's power-point presentation.  It's a pity COA commissioner Heidi Mendoza allowed herself to be a party to the Ombudsman's downright incredible numbers.  It's  equally pathetic that Ombudsman Conchita Carpio Morales, who said, "No one may intimidate me!" when he was sworn in to that office, and whom I thought to be belonging to a different breed of public officials, had now shed off her true colors.  I was wrong.  For me, Carptio-Morales is to Pinoy Aquino as Mercedita Gutierrez had been to Gloria Macapagal Arroyo.  At any rate, my hopes run high the CJ will be able to shed the true lights on this and, thus, finally eclipse the Ombudsman's "lantern of lies."

Having said the above, I suddenly recalled the P35.0 million money of the Basa-Guidote Enterprise, Inc. held in trust for a decade by the CJ's wife.  The Coronas did not own that money, of course, and hence need not declare it in  the CJ's SALN.  But if I were in the CJ's shoes, I would not allow that money to simply remain in the bank just like that, earning very minimal interests.  I would have converted those P35.0 million into dollars, open a number of dollar accounts and, through the assistance of a financial investment or banking expert, let that money earn considerably more interest incomes in dollars.  Hence, the continuous deposits and withdrawals that were highlighted by the Lady Ombudsman in her testimony.  Such banking transactions are definitely not classifiable as "money laundering".  Neither might the CJ be faulted for not including the annual balances of those dollar deposits in his SALN for the simple reason that that money did not belong to him, but was only held in trust by his wife for the account of the Basa-Guidote Enterprises.    

I am not saying this was what really happened. Whatsoever had happened, no one, not even the CJ, may ever change.  Neither, certainly, do I profess to be a "manghuhula" in this regard.  The above are simply my, let me call it, intelligent guess.  Suffice it to say that, at the end of the day, I have always believed that the Chief Justice had not been appointed such -- virtually, admit it or not, the best lawyer of the land --  if he did not know what is right or wrong, moral or immoral, before the eyes of the law and of God.   

WILL HISTORY REPEAT ITSELF?

It was, and is, clear enough that the one and only consuming mission of the prosecution and the administration has always been not as much to impeach the Chief Justice per se as to merely make him resign his post.  That's why all of the character assassinations against  Coronal were, and still are, being done not before the senate impeachment court but before the media and the public.  The thing is the CJ did  not resign, and apparently never will.

One recalls that in the beginning, the prosecutors called a press conference to announce before all and sundry that the Chief Justice had 45 properties he did not declare his SALN.  The CJ countered those were all baseless, saying he had only 6 properties, and all were recorded in his SALN.   It turned out that he had indeed only six, all the rest being more imagined than real.  Even so, the prosecutors are still questioning the one located in the Bonifacio Ridge, which the CJ had bought in 2003 but which appeared only 2010.  It turned out, as admitted by the developers themselves that the formal acceptance by the Coronas of that property did happen only in 2009, owing to several defects the Coronas found in the property which, in turn, prevented them taking formal possession thereof.

Allow me to present my personal views on this.   The prosecution, and even some senator-judges, said that the failure to declare that property in 2004 through 2009 constituted an impeachable offense.  They said that at the very least, the CJ should have reported an Accounts Receivable in his SALN, in accordance with standard accounting procedures. That maybe right, under the so-called double-entry system of accounting.  For, indeed, what the CJ did was to follow the so-called single-entry system, otherwise known as "kuwenta beho,"  most commonly seen in a sari-sari store's records.  To illustrate, when a store owner sells something on account, he only records the name of the person and the amount he owed, not as much the kind of article sold.  What only matters here is to remember the buyer's name and the amount due from him..  In the CJ's case, methinks the Deed of Sale covering the Bonifacio Ridge property was sufficient record for a single-entry transaction.  There was neither any ulterior intent on his part to conceal the property, as it did appear in his SALN, only lately, because of the property's defects which the developer was able to fix only in 2009.  It would  have been different had the impeachment trial begun without the property being yet in his SALN.  Now, we can perhaps charge the CJ, a lawyer and not an account,  for his ignorance of double entry bookeeping (even as, if we ask any CPA he will readily agree that single-entry accounting is also acceptable).  But may that ignorance be called "culpable" as to be "impeachable?"   Definitely not.  And so, what more may the prosecutors charge the CJ of with respect to property ownership?  Nothing more!

When the impeachment trial took its Holy Week break, there was every reason to believe the prosecution's case had reached the moribund stage.  With the prosecution having then rested its case, and the defense continuing to present its own witnesses and arguments, it was loud and clear that the impeachment case against Corona was gradually but surely collapsing, and that for the prosecutors to get a 16 out of 23 votes to convict Corona would certainly be an "impossible dream."

Now suddenly comes the Ombudsman testifying that according to the AMLC, Corona had millions of dollars in the bank.  It need not pass unnoticed that of the twenty three senator-judges, there were only three (Drilon, Pangilinan and Guingona, all Aquino lapdogs) who swallowed the Ombudsman's numbers hook, line and sinker.    The questions of most other senators dwelt on whether or not the Ombudsman, the AMLAC and the COA were being used by the Administration in its last-ditch effort to pin down the Chief Justice.
Likewise, whether or not the Ombudsman's testimony, which was clearly not part of the original Articles of Impeachment filed by the House could be admissible for this impeachment trial.(or  for another impeachment case one year from now) was what the senator-judges agreed to resolve in their next caucus.

To be objective, it is certainly premature now to pass judgment on the Ombudsman's testimony and its impact on the CJ's fate.  In the interim, let it suffice for me to say that the CJ has called the Ombudsman's testimony a "lantern of lies" in the same way he did call the 45 properties he allegedly owned totally baseless.  And so, at this point in time, one cannot help but ask: "Will history repeat itself or not?  Well, as comics writers tend to say in the last frame: Abangan!

AN UNCONVINCING SUPREME COURT RULING

With all due respect to the highest tribunal of the land, methinks it erred in its recent decision rejecting Pilipinas Shell Petroleum Corporation's claim for a refund of more than P95 million in excise taxes it had paid to the Bureau of Internal Revenue (Philippine Daily Inquirer, May 12, 2012).

According to the report, the tribunal's First Division granted the petition of the BIR for the reversal of the June 24, 2009 decision of the Court of Tax Appeals en banc which ordered the government to return the excise taxes paid by Shell on petroleum products it had sold to international carriers of foreign registry for their use or consumption outside the country. Shell based its claim on Section 135(a) of the National Internal Revenue Code of 1997 which expressly grants excise tax exemption to international carriers for their purchases of locally manufactured petroleum products.   However, the high court sided with the BIR's stand that Section 148 of the NIRC expressly subjects such products to an excise tax before they are removed from the place of manufacture. 

The BIR had argued that the obvious intention of the tax code was to grant excise tax exemption to international carriers and exempt entities as buyers of petroleum products, and not the manufacturers or producers of said goods.  And so, considering that the excise tax attaches to petroleum products as soon as they are in existence, the high court ruled that there can be no outright exemption from the payment of excise tax on petroleum products sold to international carriers.  In the ruling penned by Associate Justice Martin Villarama, Jr., the First Division pointed out that under the law, the excise, also called specific, tax on petroleum products manufactured in the Philippines shall be paid by the producer or person having possession thereof within 15 days from the date of removal from the place of product. 

On the other hand, I submit that one need not be a lawyer -- he needs only plain common sense -- to realize that taxes paid by the manufacturer on products it offers in the market place, whether domestic or foreign, always form part of the selling price it bills to the buyer.  How then, for heaven's sake, may an international carrier avail of the tax exemption benefit provided by Section 135(a) of the tax code under a situation where the excise tax in question already forms part of the invoice value it will pay to Shell.   Or, worded slightly differently, does the court ruling mean that it should be the international carrier as buyer, not Shell as seller, that should claim for tax refund.  Assuming it does and succeeds in the process, doesn't the transaction end up like the same banana?  That is, the BIR just the same shoulders the refund.

Methinks the court should have somehow broadened its horizon in this case; rather than conveniently limited its thinking on the  "procedural" rather than on the "doctrinal" intention of the law on excise tax.  In my view, the requirement for the manufacturer of the product subject to excise tax to pay such tax within 15 days before its removal from the place of manufacture is merely procedural.  As a matter of  fact, the payment used to be required immediately before the removal, and so oil refineries were then maintaining advance deposits for specific or excise tax, otherwise removals could only be possible during normal office hours,  unlike now when such removals can be facilitated even in the wee hours of the night.  The more doctrinal provision of the law is provided under Chapter 1, Title VI of the NIRC.  It says,  "excise taxes apply to goods manufactured or produced in the Philippines for domestic sale or consumption. . ."   This is like saying it does not apply to export sales.  Sales  of petroleum products to international carriers with foreign registry are clearly neither a domestic sale transaction nor for domestic consumption, and therefore excise-tax exempt.   The law also provides that "when goods (and they include petroleum products) locally produced or manufactured are removed and actually exported without returning to the Philippines . . . . any excise tax paid thereon shall be credited or refunded upon submission of proof  of actual exportation and upon receipt of the foreign exchange payment."  Now, may I respectfully ask: Who in this case is required to submit proof of actual exportation and receipt of the corresponding foreign exchange payment, is it the buyer, or the seller-exporter or Shell?   To whom then must the refund rightly , isn't it to Shell which, in turn, for fairness sake, should eventually give it to the international carrier?

As things are, the claimed refund not being granted,  Shell in effect practically suffers nothing, since as I earlier stated, the subject excise tax had already formed part of Shell's invoice to the international carriers.  But then, it's the international carriers that ultimately suffer the brunt, in turn unduly deprived of its right to be exempted from excise tax.  Worse, the BIR has unduly collected what it is not supposed to legally collect..

At any rate, I still feel confident the Supreme Court will sooner or later reverse the recent decision of its First Division, following a relatively fairer evaluation of Shell's surely forthcoming motion for consideration.

HAPPY MOTHER'S DAY!

Please let me post, on this very special day, a poem I wrote once upon a Mother's Day.

APO, INA, LOLA: MUNTING ANEKDOTA

Sa isang tahanang malayo sa bayan,
Tatlong mag-iina ang naninirahan:
Apo, Ina, Lola -- kanilang kubabaw
Ang hirap at alwan sa mundong ibabaw.

Bagama't maagang sila'y naulila
Sa tingi't kalinga ng ama't asawa,
Ang tatlo'y may munting bukiring namana
Na napagkukunan ng sapat na kita.

Panaho'y nagdaa't ang lolang butihin,
Sa pagtanda'y naging ulyani't bugnutin;
Walang ano-ano'y magbabasag mandin
Ng mangkok o baso.  Ay naku, pasanin!

Sa gayon, ang ina'y nagsugo sa anak:
"Iha, umuwi ka't si Lola'y  ihanap
Ng pinggang di yari sa kristal o luwad,
'Yong plastik o latang hindi mababasag."

Nalungkot ang anak sa utos ng ina,
At pusang alaga'y biglang naalala.
"O, Inay, si Muning ay hindi po baga
Kung ating pakani'y sa mangkok na lata?"

Kung gayon po, Inay, bakit tila yata
Kay Lola ang turing mo na'y isang pusa?
Iilang taon na't siya'y mawawala,
Lubusin na sana ang ating kalinga!"

Subali't anuman ang gawing pamanhik
Ng anak, ang ina'y hindi rin naantig.
Lumisan ang bunso't naghanap na pilit
Ng mangkok na yari sa lata o plastik.

Nang ito'y magbalik, ang ina'y nagulat
At dalwang piraso ang uwi ng anak.
"Aba, bakit dalwa 'yang iyong akibat,
Isa lang, hindi ba, ang bilin ko't hangad?"

"Yon pong isa'y aking itatabi, Inay,
Laan ko sa iyo pagdating ng araw;
Tulad ng kay Lola'y akin ding papaltan
Ng plastik na plato ang iyong kainan..."


Happy Mother's Day to one and all!