{"id":14411,"date":"2023-11-08T07:30:00","date_gmt":"2023-11-07T23:30:00","guid":{"rendered":"https:\/\/www.quezon.ph\/?p=14411"},"modified":"2023-11-08T10:48:33","modified_gmt":"2023-11-08T02:48:33","slug":"the-long-view-8","status":"publish","type":"post","link":"https:\/\/www.quezon.ph\/2023\/11\/08\/the-long-view-8\/","title":{"rendered":"The Long View: Twisted Genius"},"content":{"rendered":"

Twisted genius<\/h1>\n<\/hgroup>\n
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By: Manuel L. Quezon III<\/a> – @inquirerdotnet<\/a><\/div>\n
Philippine Daily Inquirer<\/a> \/ 05:15 AM November 08, 2023<\/div>\n<\/div>\n<\/div>\n<\/div>\n
<\/iframe><\/div>\n<div id=\"lb_wrap_article\">\n<div data-ad=\"lb1\"> <\/div>\n<div id=\"div-gpt-ad-lb1\" data-google-query-id=\"CP6H-Yius4IDFdXLfAodtVIPwg\">\n<div id=\"google_ads_iframe_\/21631601933\/inqphv1.opinion\/columnists_lb1_0container\"><iframe id=\"google_ads_iframe_\/21631601933\/inqphv1.opinion\/columnists_lb1_0\" tabindex=\"0\" title=\"3rd party ad content\" role=\"region\" name=\"google_ads_iframe_\/21631601933\/inqphv1.opinion\/columnists_lb1_0\" width=\"970\" height=\"250\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\" aria-label=\"Advertisement\" data-load-complete=\"true\" data-google-container-id=\"8\" data-mce-fragment=\"1\"><\/iframe><\/div>\n<\/div>\n<\/div>\n<\/div>\n<div id=\"art_body_wrap\">\n<div id=\"article_content\" class=\"article_align\">\n<p>When Fumio Kishida became <a href=\"https:\/\/www.congress.gov.ph\/photojournal\/zoom.php?photoid=5349\">the first Japanese premier to address a joint session of our Congress<\/a>, he wasn\u2019t exaggerating when he said, \u201cThe relationship between Japan and the Philippines has made great strides over the past half century,\u201d with a particular emphasis on growing defense ties. But part of the Japanese approach is to tout the benefits of increased Japanese investments. Here, however, the prospects may not be so rosy, as the Japanese prime minister surely knows and may have privately communicated to Filipino officials. At the very least, if a festering irritant isn\u2019t resolved, it bodes ill for enticing investments, overall and not just from Japan.<\/p>\n<p>Here\u2019s the background, first brought to public attention by the retired investment banker Leo Alejandrino in his blog, \u201cHeneral Lunacy.\u201d In <a href=\"https:\/\/heneralunacy.wordpress.com\/2023\/10\/29\/warning-signs\/\">an Oct. 29 entry titled \u201cWarning Signs,\u201d<\/a> the dramatic opening sentence was, \u201cOur government is becoming known for not paying its bills.\u201d According to Alejandrino, \u201cForeign chambers of commerce have publicly demanded the government pay them the [value-added tax] refunds owed them. One company alone has outstandings of [P3.8 billion.] Many of the companies are Japanese electronic exporters employing thousands of Filipinos and generating much-needed foreign exchange. They have threatened to pull out if the issue is not resolved. Japanese rarely speak out so the problem must be serious.\u201dAlejandrino puts the problem in context in this way: \u201cThe foreign chambers have cited the VAT refund as a reason for international investors to avoid the Philippines when Vietnam, Indonesia, Thailand, and Malaysia are seeing massive inflows from suppliers relocating out of China. In 2022, the Philippines [foreign direct investments] dropped 22 [percent] to only $9.6 billion and have continued to fall this year.\u201d Were you to go beyond foreign chambers of commerce and ask the natives, another part of the problem is the perception that the bureaucracy has become bolder about being greedy. But one doesn\u2019t have to get mired in the hall of mirrors that is the perception game, you only have to look deeper into the question of why, in the first place, would government impose an (informal) policy of denying legitimate businesses refunds to which they are entitled by existing regulations?<\/p>\n<p>A former senior government official explains it this way: Not refunding is not due to the CREATE law as some might think, but rather, it is a problem of tax administration. In reality, according to the former official, \u201cThere is a perverse incentive going on\u201d to explain why things are the way they are.<\/p>\n<div id=\"billboard_article\">\n<div id=\"bb_box\">\n<div id=\"div-gpt-ad-mrec1\" data-google-query-id=\"CKew9Yius4IDFdXLfAodtVIPwg\">\n<div id=\"google_ads_iframe_\/21631601933\/inqphv1.opinion\/columnists_mrec1_0container\"><iframe id=\"google_ads_iframe_\/21631601933\/inqphv1.opinion\/columnists_mrec1_0\" tabindex=\"0\" title=\"3rd party ad content\" role=\"region\" name=\"google_ads_iframe_\/21631601933\/inqphv1.opinion\/columnists_mrec1_0\" width=\"1\" height=\"1\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\" aria-label=\"Advertisement\" data-load-complete=\"true\" data-google-container-id=\"1\" data-mce-fragment=\"1\"><\/iframe><\/div>\n<\/div>\n<\/div>\n<\/div>\n<p>It works this way: The authorities set revenue targets for the Bureau of Internal Revenue (BIR) to meet. As it goes about its business, the BIR then embarks on being \u201cstrict\u201d when it comes to collecting taxes and this includes how it goes about refunding VAT: it doesn\u2019t.<\/p>\n<p>When companies object, they have to go to the Court of Tax Appeals to question the BIR\u2019s decision. This is costly. \u201cSo sometimes,\u201d according to the ex-official, \u201ccompanies would decide to \u2018settle.\u2019\u201d<\/p>\n<div id=\"mgid-pad\" class=\"mgid-desk\" data-pos=\"reco_desktop\">\n<div id=\"M912767ScriptRootC1524606_0ca16\">\n<div id=\"MarketGidComposite1524606_0ca16\">\n<div>\n<div class=\"mgbox\">\n<div class=\"mgheader\"><span class=\"mghead\">You may like<\/span>\n<div class=\"mg_addad1524606\"><a href=\"https:\/\/opinion.inquirer.net\/167932\/twisted-genius#\" rel=\"sponsored nofollow noopener\"><object width=\"58\" height=\"26\" aria-label=\"logo\" data-mce-fragment=\"1\"><a href=\"https:\/\/widgets.mgid.com\/?utm_source=opinion.inquirer.net&utm_medium=referral&utm_campaign=widgets&utm_content=1524606\" target=\"_blank\" rel=\"sponsored nofollow noopener\"><img decoding=\"async\" src=\"https:\/\/cdn.mgid.com\/images\/mgid\/mgid_ua.svg\" width=\"55\" height=\"26\" alt=\"\"><\/a><\/object><object width=\"20\" height=\"26\" aria-label=\"logo\" data-mce-fragment=\"1\"><a href=\"https:\/\/www.mgid.com\/services\/privacy-policy\" target=\"_blank\" rel=\"sponsored nofollow noopener\"><img decoding=\"async\" src=\"https:\/\/cdn.mgid.com\/images\/logos\/Adchoices.svg\" width=\"20\" height=\"20\" alt=\"\"><\/a><\/object><\/a><\/div>\n<\/div>\n<div class=\"mgline teaser-15157920 type-w\" data-i=\"6XI8AM8CqKJZ2eD650GRGTgJZTzFaNhtMFbhy43TEEZgZVzBxG0lsNfDoAByyNoazHSW2WiSDIsICji6_dFFiQ\" data-observe-time=\"0\" data-observe-start=\"0\" data-observing=\"yes\" data-observing-start=\"0\" data-observing-time=\"0\" data-load-fired=\"true\">\n<div class=\"image-with-text\">\n<div class=\"mcimg\">\n<div class=\"image-container\"><img fetchpriority=\"high\" decoding=\"async\" class=\"mcimg\" style=\"display: none !important;\" src=\"https:\/\/s-img.mgid.com\/g\/15157920\/984x656\/-\/aHR0cDovL2NsLmltZ2hvc3RzLmNvbS9pbWdoL2ltYWdlL2ZldGNoL2FyXzM6MixjX2ZpbGwsZV9zaGFycGVuOjEwMCxmX2pwZyxnX2ZhY2VzOmF1dG8scV9hdXRvOmdvb2Qsd18xMDIwL2h0dHA6Ly9pbWdob3N0cy5jb20vdC8yMDIyLTAyLzM2OTQwMy9iOTQ2YTk1YTg5NDQ1Nzc5YjI5YzU1ZTgxNjYxNTJhOC5qcGVn.webp?v=1699410665-mcAAMxyJs4loTDlwxL8j80uZ_h6qnpkvobwk9_n_Z9I\" alt=\"\" width=\"492\" height=\"328\" crossorigin=\"\" data-i=\"15157920\" data-src=\"https:\/\/s-img.mgid.com\/g\/15157920\/984x656\/-\/aHR0cDovL2NsLmltZ2hvc3RzLmNvbS9pbWdoL2ltYWdlL2ZldGNoL2FyXzM6MixjX2ZpbGwsZV9zaGFycGVuOjEwMCxmX2pwZyxnX2ZhY2VzOmF1dG8scV9hdXRvOmdvb2Qsd18xMDIwL2h0dHA6Ly9pbWdob3N0cy5jb20vdC8yMDIyLTAyLzM2OTQwMy9iOTQ2YTk1YTg5NDQ1Nzc5YjI5YzU1ZTgxNjYxNTJhOC5qcGVn.webp?v=1699410665-mcAAMxyJs4loTDlwxL8j80uZ_h6qnpkvobwk9_n_Z9I\"><img loading=\"lazy\" decoding=\"async\" class=\"mcimgad\" style=\"display: none !important;\" src=\"https:\/\/cdn.mgid.com\/images\/mgid\/int_exchange_wages_ad.svg\" alt=\"\" width=\"20\" height=\"20\"><\/div>\n<\/div>\n<div class=\"text-elements\">\n<div class=\"text_on_hover\">\n<div class=\"mctitle\"><a href=\"https:\/\/clck.mgid.com\/ghits\/15157920\/i\/57856240\/0\/pp\/1\/1?h=6XI8AM8CqKJZ2eD650GRGTgJZTzFaNhtMFbhy43TEEZgZVzBxG0lsNfDoAByyNoazHSW2WiSDIsICji6_dFFiQ&rid=ddf0fa10-7dde-11ee-b241-c84bd6826d76&ts=inquirer.net&tt=Referral&att=4&cpm=1&abd=1&iv=11&ct=5&gdprApplies=0&st=540&mp4=1&h2=uFg4BO-kyaCt97nCVY2xOevi_0pJ7ErbrIwCwoPdh2U*&muid=n8bQAOJ6iL7m\" target=\"_blank\" rel=\"sponsored nofollow noopener\" data-hash=\"6XI8AM8CqKJZ2eD650GRGTgJZTzFaNhtMFbhy43TEEZgZVzBxG0lsNfDoAByyNoazHSW2WiSDIsICji6_dFFiQ\">???? 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It\u2019s an accounting trick but a politically important one.<\/p>\n<div id=\"billboard_article\">\n<div id=\"bb_box2\">\n<div id=\"div-gpt-ad-mrec2\" data-google-query-id=\"CPiH-Yius4IDFdXLfAodtVIPwg\">\n<div id=\"google_ads_iframe_\/21631601933\/inqphv1.opinion\/columnists_mrec2_0container\"><iframe id=\"google_ads_iframe_\/21631601933\/inqphv1.opinion\/columnists_mrec2_0\" tabindex=\"0\" title=\"3rd party ad content\" role=\"region\" name=\"google_ads_iframe_\/21631601933\/inqphv1.opinion\/columnists_mrec2_0\" width=\"300\" height=\"250\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\" aria-label=\"Advertisement\" data-load-complete=\"true\" data-google-container-id=\"2\" data-mce-fragment=\"1\"><\/iframe><\/div>\n<\/div>\n<\/div>\n<\/div>\n<p>Concludes the ex-official: \u201cThus, the optimal move of the BIR, given the current system, is to assess and deny refund.\u201d Its overall collections look bigger, more impressive, and easier to achieve. This is what matters and a reality that has chambers of commerce angrily whispering in private, and companies threatening in private to leave, can do so all they want because of official window-dressing.<\/p>\n<ins class=\"adsbygoogle\" data-ad-client=\"ca-pub-3470805887229135\" data-ad-slot=\"3036397234\" data-ad-format=\"auto\" data-full-width-responsive=\"true\"><\/ins>\n<p>The former official is still hopeful that, \u201cwith all the new tax admin issuances and the amendment of the tax code w.r.t. refund, things will improve.\u201d According to the former official, an attempt was made to simplify the requirements and the process for refunds. This was part of the \u201cease of paying taxes\u201d bill which its proponents still hope will be enacted soon.<\/p>\n<p>Of course, Alejandrino\u2019s point goes beyond the woes of Japanese businesses here. According to him, the government is in arrears when it comes to paying travel tax refunds owed \u201cbalikbayans\u201d (which is hurting tourism), Philippine Health Insurance Corp., and\u2014<a href=\"https:\/\/x.com\/CleveArguelles\/status\/1720736967380627506?s=20\">this explains recent news items<\/a>\u2014military pensions; some agencies are getting only 30 percent of their budget while other appropriations have been drastically cut, too.<\/p>\n<p>His damning conclusion: \u201cOur economic managers have done a good job at masking our true state of affairs with opaqueness on governance and corruption, by talking up the economy, by playing with the numbers, by not servicing noninterest bearing payables, by kiting, by government providing inferior goods and services \u2026\u201d Guess when the government last became notorious for many of these practices? <a href=\"https:\/\/www.ourbrew.ph\/bankrupt\/\">The original Marcos era<\/a>.<\/p>\n<div id=\"mgid-pad\" class=\"mgid-desk\" data-pos=\"mpact_desktop\">\n<div id=\"M912767ScriptRootC1524609_14c08\">\n<div id=\"MarketGidComposite1524609_14c08\"> <\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<p style=\"white-space:nowrap\"><script type=\"text\/javascript\" src=\"http:\/\/tarpipe.com\/js\/widget.js\">{title:\"The Long View: Twisted Genius\",url:\"https:\/\/www.quezon.ph\/2023\/11\/08\/the-long-view-8\/\"}<\/script><\/p>","protected":false},"excerpt":{"rendered":"<p>Tweet THE LONG VIEW Twisted genius By: Manuel L. 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Quezon III","author_link":"https:\/\/www.quezon.ph\/author\/mlq3\/"},"uagb_comment_info":0,"uagb_excerpt":"Tweet THE LONG VIEW Twisted genius By: Manuel L. Quezon III – @inquirerdotnet Philippine Daily Inquirer \/ 05:15 AM November 08, 2023   When...","_links":{"self":[{"href":"https:\/\/www.quezon.ph\/wp-json\/wp\/v2\/posts\/14411"}],"collection":[{"href":"https:\/\/www.quezon.ph\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.quezon.ph\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.quezon.ph\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.quezon.ph\/wp-json\/wp\/v2\/comments?post=14411"}],"version-history":[{"count":2,"href":"https:\/\/www.quezon.ph\/wp-json\/wp\/v2\/posts\/14411\/revisions"}],"predecessor-version":[{"id":14413,"href":"https:\/\/www.quezon.ph\/wp-json\/wp\/v2\/posts\/14411\/revisions\/14413"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.quezon.ph\/wp-json\/wp\/v2\/media\/11007"}],"wp:attachment":[{"href":"https:\/\/www.quezon.ph\/wp-json\/wp\/v2\/media?parent=14411"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.quezon.ph\/wp-json\/wp\/v2\/categories?post=14411"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.quezon.ph\/wp-json\/wp\/v2\/tags?post=14411"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}