Wealth tax on billionaires can boost economic, medical response – IBON

Infographics by Dawn Peña / Bulatlat


MANILA – Independent think tank Ibon Foundation said that a wealth tax on Filipino billionaires can fund much-need financial assistance and the boosting of the country’s economic and medical response in 2022.

“Substantial revenues can be raised by taxing the country’s super-rich who can well afford to contribute much more to COVID-19 response and other needs. This is aside from how the administration can realign funds from bloated infrastructure, military and police, and debt servicing items in the proposed 2022 budget,” Ibon Foundation in a statement.

IBON’s report was published following the filing of House Bill 10253, or the Super-Rich Tax Act of 2021. Authored by progressive partylists under the Makabayan bloc, this bill would impose individual wealth taxes of one to three percent on billionaires with taxable assets of one billion pesos or more.

The revenues from taxing the super rich, Makabayan proposed, would be earmarked for social services. At least 60 percent shall be allocated for medical assistance and the Health Facilities Enhancement Program (HFEP), the annual requirements of which will be determined by the Department of Health. Meanwhile, 40 percent will be used for social mitigating measures and investments in education, social protection, employment, and housing that prioritize and directly benefit both the poor and near-poor households.

The measure will hopefully reverse what IBON explained as the cause behind the collapse in the economy and livelihoods which are the government’s militaristic lockdowns and refusal to spend more for cash aid and supporting businesses and producers.

“There are more poor and unemployed Filipinos. Many MSMEs closed down or are only able to operate partially. The health system is as weak as ever as cases climb; testing, tracing, isolation, treatment and vaccination lag; and our medical frontliners remain neglected,” the group added.

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IBON stressed that taxing the super-rich is an effective way to raise much-needed funds for expanding social and economic services while reducing inequality. The group estimated that the richest one percent of the population holds at least 40 percent of the country’s wealth.

“At the very top are around 2,919 Filipino billionaires with some P8.1 trillion (US$158.57 billion) in wealth. They comprise less than 0.003% of the population but hold 16 percent of the nation’s wealth,” the group explained.

As it stands, the country’s richest families have continued to rake in billions amid the pandemic, including that of real estate developer Manuel Villar, whose wealth grew from $5.6 billion in 2020 to $7.2 billion this year, according to Forbes.

Combined with realignments from non-essential infrastructure, defense, and other items in the proposed 2022 national budget, IBON said it is more than enough to provide P10,000 ($196) in emergency aid to 18.6 million households in distress, P101 billion ($1.98 billion) for MSMEs as wage subsidy to support P100/day ($1.96) wage increase for three months, and P220 billion ($4.3 billion) for agricultural support.

“There will still be enough left to hire additional health workers, for more aggressive testing and tracing, and to ensure free vaccination for all,” according to the group.

The group added that collecting just a fraction of the huge wealth of a few is a step to redistributing wealth towards the working people who did so much to create it.

“A wealth tax also improves democracy in the country. If we want to change our politics, we also have to change the maldistribution of wealth that gives a handful too much power,” concluded IBON. (JJE) (https://www.bulatlat.com)

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