TRAIN Law Plunging Workers and Poor Deeper into Poverty, Says Labor Rights NGO

February 1, 2018

Almost exactly a month since the Duterte administration implemented its much-hyped Tax Reform for Acceleration and Inclusion law, labour rights organization, Center for Trade Union and Human Rights (CTUHR) expressed serious alarm over the TRAIN effects saying it is rapidly plunging workers and poor families into deeper into poverty and precariousness.  CTUHR also points out that instead of bringing relief, the new tax measure added more burden to workers long been suffering from meager wages and job insecurity.  Workers randomly interviewed in some areas of Valenzuela, Caloocan and Novaliches complained to CTUHR of further belt-tightening to cope with rocketing prices of basic goods and commodities. Maria (not her real name), a factory worker in Valenzuela narrated that a P10 small bowl of lugaw (porridge) she eats for lunch used to be enough for her, now she has to spend P20 because P10 can only pay for half bowl now.

Small-store owners also complain of profit reduction yet afraid to adjust their prices as they may end up losing customers. People are also troubled by the looming surge on transportation fares and electricity rates due to higher tax on oil products. “I used to spend Php 161 for four liters of gas to cover for four days travel to work from Novaliches to G. Araneta Avenue and back by motorbike. Now I am spending Ph166 and its only for three days. I am joining rally now to protest”, says Jeremy. These responses speak how the TRAIN severely affects the poor in general,” CTUHR Executive Director Daisy Arago said.

“What the TRAIN has accomplished so far, is to simply and effectively widen the gap between daily income and high cost of living. The tax reform makes it more difficult for workers even in the formal sector to get by with the value of  their meager wages shrink amidst soaring prices of basic goods. Instead of legislating a substantial wage hike long been demanded by workers, Duterte administration passed a higher consumption taxes hitting the poor more while ensuring bigger profits for oligarchs and corporations and to its grandiose and big-ticket infrastructure projects.  To say that the TRAIN is his biggest gift to Filipinos shows a gross disregard to the real plight of the poor majority. It’s a poisonous gift,” Arago added.

Citing data from government and Ibon foundation, CTUHR said the reported 7.5 million individuals with annual earnings of P250,000 purportedly stand to benefit from lower personal income tax is only half of the 15.2 million minimum-wage earners. They and low-income families bear the brunt of TRAIN-triggered price increases with no income tax gains. It added that Ibon study shows that the richest 10 percent with average earning of P104,107 monthly will get an additional P90,793 annually while the middle income and lower-middle income families will have P7,880 to P24,343 additional take home pay. On the other hand, the poorest 60% or 13.7 million families will have to shoulder P600-P2000 additional expense.

The labor NGO also challenged the administration’s neoliberal economic managers to prove that the tax law will have minimal impact and benefits the poor when prices of everything and transactions except wages.

The labor group also emphasized an urgent need for a legislated national across-the-board wage hike not the P200 subsidy the government plans to give to the poor. “This is so painfully infuriating, to borrow the word from government economic managers, TRAIN gets so much from the poor, and when the poor complains, they offer crumbs to keep them quiet. Change has indeed came, but not in favor of the poor majority. It is understandable and worthy of support when the poor goes out to the streets to say we do not need the TRAIN that does not only malfunction, but also brings us to a living suffering,” Arago ended. #