Finance exec hit for conflict of interest

MANILA, Philippines – Bayan Muna party-list Rep. Carlos Zarate raised the issue of conflict of interest yesterday against Department of Finance (DOF) Undersecretary Karl Kenneth Chua, a former senior economist of the World Bank, who “might be bringing to the DOF his conflicted positions” on tax reform.

Zarate said the WB and the International Monetary Fund (IMF) were to blame for the country’s regressive tax system.

He said President Duterte and DOF Secretary Carlos Dominguez III should not rely on these two institutions and its people for the administration’s tax reform plans.

“Change must also come to the DOF. We must be very careful. We must ensure that our push to have lower income taxes would not be offset by more expanded taxes in the long run that would just wipe out the gains of lower income tax to consumers,” he added.

Zarate warned Dominguez against the IMF’s offer to help put together the planned tax reform package.

He said it was possible that the IMF was behind Dominguez’s proposal to impose a tax of P6 per liter on diesel, kerosene and cooking gas, and to increase the levy on gasoline from P4.35 per liter to P10.

He said the DOF was also planning to “broaden” the value added tax (VAT) base by reducing exemptions for senior citizens.

“The revenue generation proposals being floated by the DOF, in lieu of the proposed adjusted income tax base, like the additional oil excise tax and the further expanded VAT-base, are anti-poor and would be an added burden to consumers,” he said.