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Philippine fury at text tax

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Filipino consumer groups have reacted with outrage to a proposed law imposing a tax on text and multimedia messages sent from mobiles.

Despite attempts to include a "no-pass-it-on" proviso in the bill it passed yesterday with no such safeguard.

Speaker Prospero C Nograles said: "We will not allow any such additional taxes on the shoulders of the public." He said he there was no need to increase the cost of texts paid by punters but that the tax should be extracted from mobile operators.

Messages typically cost a peso and the government wants only five cents in tax - or more for multimedia messages. Nograles reckons the tax amounts to about 20 per cent of operator profits on each message.

The Ways and Means Committee will now introduce a substitute bill which will include a provision that the tax must be paid by mobile operators. Any attempt to pass on the tax to punters will lead to suspension of their franchise licences.

Nograles's statement is here.

But Philippine consumer group TXTPower is unimpressed. It pointed out that the government already puts a 12 per cent tax on mobile services so a further tax was unjustified.

The group offered a well-worded alternative to filling the 36bn peso debt hole. TXTPower suggested: "By reallocating P4-million from each congressman’s pork barrel, P10-million from the Office of the President and 10 percent from the budget intended for debt servicing."

The full statement is here. ®

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