Given the current socioeconomic climate, the Philippine government tries to tax the rich.
Obtaining luxury items and properties are the dream of many. The grandiosity of buying a designer bag or a luxury property comes with a certain feeling. You can only experience said feeling after swiping that card. A rush of excitement and achievement runs through the body, knowing that you’ve purchased something you’ve been dreaming about.
With the worldwide financial crisis happening, different governments have been exhausting different efforts to bridge the financial gap. In the Philippines, one of the proposed ways of Congress is to create a tax. A tax that would affect the 0.0001 percent of the country’s population.
Albay Rep. Joey Salceda wrote in his House Bill 6993 with one thing in mind. “The single most crucial flaw of the country’s tax system is its failure to tax the rich,” he said in the explanatory note. The idea of giving those who are in the upper class the burden of an additional tax is a recommendation from national and international organizations.
The proposed luxury tax includes taxing luxurious consumption. Moreover, under luxurious consumption is buying the following items: luxury watches and cars, sale of residential properties above P100 million, beverages above P20,000, and leather products above P50,000. Furthermore, the House plans to add a 20%-25% increase in these so-called non-essential goods.
“The non-essentials goods tax will be on top of all other taxes. The tax on luxury cars, for example, will be on top of the automotive excise tax, which is arguably a pollution and congestion tax but not yet a luxury tax. The tax on luxury residential properties will be on top of VAT and other taxes on its sale,” as per the exploratory note.
Banner photo by Alexandra Maria via Pexels.