It is a vicious cycle. In my professional life as a CPA and lawyer, I have always encounter these remarks: "Why should I pay my taxes? The unscrupolous people in the government will just corrupt them". I always tell them to pay their taxes and demand (and insist) good services from the government.
Taxes pay for the salaries of government officials.
Taxes pay for the salaries of policemen.
Taxes pay for the salaries of public school teachers.
Taxes pay for the salaries of the President and her cabinet.
Taxes pay for the salaries of the Chief Justice and his people.
Taxes pay for the salaries of every senators and congressmen.
SO DEMAND GOOD SERVICES FROM THEM!!!
Taxes enable the government to construct new roads, highways and bridges.
Taxes enable the government to construct schools, buildings and other structures.
Taxes enable the government to provide light in the streets at night.
Taxes enable the government to provide health services.
Taxes enable the government to provide social services for the needy.
Taxes enable the government to defend the security of the country from threats.
IN SHORT, TAX IS THE LIFEBLOOD OF THE GOVERNMENT!!!
Tomorrow (April 15) shall be the deadline for filing the Income Tax Return of corporations, business establishments and professional individuals. And while the BIR campaign on an early filing of the ITR as early as January, it has always been the nature of the Filipinos to always beat the deadline, so expect a long queue of taxpayers in banks tomorrow.
Here is a sad fact: Those persons employed pay an average of 20% to 35% tax of their compensation while corporations pay only an average of 5% to 10% of their income. Why is this so?
Those persons employed are what we call captured tax-payers. Their employers withheld a certain amount of money from their monthly salaries and directly remit them to the BIR. The amount of money to be deducted from their salaries depend on ther income bracket. Those who earn less has less deductions compared to those who earned more. At the end of the year, their employers shall issue them a certificate showing the amount of taxes deducted from their salaries for a given calendar year. Thus, come filing, if their tax due is equal to their tax withheld, then there is no more need to file an ITR. However if the employees' tax due is different from tax withheld, then he has no choice but to file an ITR and pay for the deficiency before April 15.
The situation is different for corporations. These corporations usually employ every trick in the book just to avoid paying taxes. Some of them even employ the services of highly-trained and technical tax consultants to legally avoid paying large sums of taxes. I mentioned legally avoid because as compared to Tax evasion, tax avoidance is legal. The former is illegal and punishable by law while the latter is legal because it maximizes the loopholes of tax laws to avoid paying taxes (lessening tax fo that matter).
And here is another fact: Based on the study conducted by NEDA, taxes contributes only 14% on our country's GDP compared to other asian countries who averages about 25%. Do this mean that taxpayers in those countries are more socially responsible? Or maybe, this is where the endless vicious cycle comes to play. That is, Filipinos do not want to pay taxes because they are not satisfied on how the government expend their hard-earned money.
What do you think? Have you paid your taxes already?