Tax(es)-on-Text (Biting the Hands that Feed the Government)

A friend ranted about this tax on text bill. Having been reading all about texts and tweets lately, it kind of alerted me. Of course, this will affect the users of @tweetitow (Shameless plug: Click here on how to use @tweetitow — texting your tweets.). Plus, text is probably the only thing that has not increased its price. It is probably the cheapest form of entertainment for Filipinos — that it’s too cruel for the Philippine Government to rob us with that little joy left.

I learned from Manila Times, that our texts are already subjected to 2 different taxes — 12% VAT and 30% income tax. So this new text tax will be the 3rd tax impose on text if ever it gets approve by the senate. I’m no financial analysts, but 42% of what we pay for our SMS/MMS goes to the BIR or government or whoever gets the tax. That’s almost 50%! It seems government are still not happy with their almost 50% share yet!

So here comes Tax-on-text bill (House Bill # 6625) which seeks to impose a P0.05 excise tax on sms/mms (which makes me think, how about emails sent via mobile). It was approved by Congress last Tuesday. Hopefully, it will not be approved in the Senate House.

But it’s just P0.05, will it really affect the text price rate? According to inquirer news, text promos or those unlimited texting offers bring down the price of per text to P0.10. So if you are a fan of unlimited texting subscriptions, you are actually just paying 10 centavos per text. Now if tax-on-text bill will be approved by the senate and government, the text price will become P0.15. It’s really quite small but if you look at it by percentage, it actually increases the price by 50%.

Even though government would say that the tax will be shouldered by the telco providers to free the Filipino people from another tax, we all know it will still be passed on to the consumers. Telco may not increase the text price to P1.05,  but they might be forced to scrap off those unlimited text packages which a lot of people are enjoying. Or, worst both — increase text price and scrap the unlimited texting services.

But on the other hand, the tax-on-text will also help generate our Philippine government a P20-30 billion revenues which can help fund a lot of needed projects — like health and education according to Gordon in inquirer news. It will also fund the P1.541 trillion inter-agency Development Budget Coordination Committee (eeerrr, what is this?). Breaking the ordinary people’s budget to put up a budget coordination committee — ironic huh.

I mean it is good for governments to have more money to answer our important needs — better schools, better hospitals, better roads, better everything. But it will not hurt for them to be more creative in finding other ways to get more funds other than milking on tetetexts.

If the information I gathered are true, government are already enjoying almost 50% on our textsssss! If they would push through with that tax-on-text bill, majority of the people may scrimp/cut or stop texting (but I doubt it though). If people will minimize/stop texting, this can mean losing their 50% cut on text revenues. I do not think it’s a practical move. I think it’s better to keep the 50% shares than pushing the P0.05 which is like ‘biting the hands that feed them.’

1 Comment

Filed under Philippine Mobile Services, Philippine Unlimited Text Culture

One response to “Tax(es)-on-Text (Biting the Hands that Feed the Government)

  1. Reb

    Thats nice if its true,. I mean Does our country really enjoy th0se said benefits by paying our taxes, people pay taxes but i d0nt see any impr0vements, well except on electi0n days,.. The filipino people are already being robed but they are too ign0rant to kn0w this,. If there is realy an impr0vement then i sh0vldnt be seing kids on jeeps being kund0kt0rs instead they sh0vld be at sch0ol enj0yng free or cheap educati0n,.