It is naïve or downright dumb to think that political statements alone deter or encourage investments. The past two administrations have been saying things to please investors and foreign governments, yet the kind of investments needed from them have not come. We have only looked good, but have not done what was needed to seal the deal.
Infrastructure and the right investments in it will seal it. Closing the gap to deliver the infrastructure we need will push growth no matter how cynical we are. That, to the investor, is putting your money where your mouth is.
But public infrastructure requires revenue. It needs proper taxes. For the first time in many years government is taking taxation seriously, and the people are taking note.
Lowering individual income taxes is a good thing. It frees up incomes for spending on family needs and possibly, small investments. It is wise to look at what the Comprehensive Tax Reform Program (CTRP) will deliver if passed in the TRAIN and TARA Bills authored by Rep. Dax Cua and Joey Salceda.
The Department of Finance is pushing these two bills as a CTRP to sustain the pace of growth to 7 percent or better, bring down the poverty rate to 14 percent in the medium term and pave the way for the country to become a high-income economy by 2040.
DOF Secretary Carlos Dominguez said that, “If we fail to raise the volume of revenues required for our economy to break out over the next few years, we will fail in everything else.”
He adds: “We will fail to close the infrastructure gap. We will fail to make the investments in our young to prepare them for meaningful economic participation. We will fail to catch up with our neighbors in the region who have invested twice of the amount than what we did on infra over the past three decades. Most important, we will fail to bring down the level of poverty afflicting our people,” he said.
DOF Undersecretary Karl Kendrick Chua also pointed out in the House committee hearings that the proposed CTRP will allow the government to build or improve 44,000 kilometers of national and local roads, construct more local hospitals and improve existing ones, and achieve the ideal teacher-to-student and student-to-classroom ratios for the benefit of the country’s future workforce.
He further said that some P48 billion will be earmarked for targeted transfer programs for low-income groups and other vulnerable sectors to shield them from the initial impact of the CTRP.
The CTRP will also fund the construction of 113,553 more classrooms and the hiring of 181,000 more teachers for the public school system over the next five years, he said.
He said the CTRP will likewise help attain 100 percent PhilHealth coverage, build 25 more local hospitals and upgrade 704 existing ones, on top of also improving 263 rural and urban health centers, constructing 8,412 new barangay and rural health centers; hire an additional 2,424 doctors, 39,466 nurses, 2,862 medical technologists, 1,090 dentists, 911 public health associates, 2,497 Universal Health Coverage implementers, and 3,288 pharmacists between 2017 and 2022.
These assertions set expectations and targets like never before, and we hold government to it, perhaps ask them to even expand these. It is time we did so.
Pushing proper revenue measures and targets inspires investors, sending the message that the powerpoint presentation is worth listening to and the trade mission is worth attending. Yes there have been successive visits to the Philippines, and more to come.
It finally puts the governments money where its mouth is.
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