The TRAIN aims to
make the Philippine
Tax System simpler, by patricia angelica b. vinuya
fairer, and more
efficient to promote
investment, create jobs TRAIN Law is a big step for the current administration
and reduce poverty to pull off. It is designed to make the tax system one
in which everyone contributes her or his fair share of
our investments in infrastructure and human
development - which past administrations failed to do
so because it has always been an issue of band-aid
solutions. Theoretically, the goals of TRAIN law will not
only benefit the government but the people, as well.
Furthermore, it does not only generate funds but will
also improve the delivery thereof.
As a Political Science student, TRAIN law has helped me gain and improve
my knowledge of the Philippines' tax system. This knowledge helped me
understand taxation lessons because it poses real-life situations/cases that
can be essential if I plan to study in law school or pursue a master's degree.
Learning is a life-long process; it is good to equip ourselves with the
knowledge to help us in the real-world context.
Understanding the TRAIN law guides me to choose the career that I want to
pursue if income is the primary consideration when selecting because this
preps me for any responsibility and obligation that I will be facing regarding
my income tax. Most people only think of the income they will be receiving
without considering the tax that comes with it, so others do not succeed in
financial management.
As a college student, it has been challenging to manage finances, especially for
students my age (young adults) who tend to be impulsive with expenses, not
knowing the repercussions. TRAIN law helped me manage my finances since we
indirectly pay taxes (VAT) when purchasing products, especially from shopping
malls. I remind myself how much I will be spending for something that I don't
need if I keep in mind that I also pay taxes even as a student.
Detractors of the TRAIN Law anticipated that a rise in petroleum prices would cause a domino
effect, increasing the prices of goods and services, all of which would fall on the hands of
consumers, especially the poor. Since the beginning of 2018, the increase in prices of daily
goods has been quite noticeable. People were outraged by the price increase and demanded
that the law be suspended. While the TRAIN Law was not entirely to blame, we cannot
overlook ordinary people's inability to afford rice, let alone soft drinks, alcohol, and cigarettes,
as well as the fuel needed for regular transportation. When their family budgets purchased
less and fewer groceries, mothers and homemakers found themselves on the front lines.
Restaurants began to cut corners on portion sizes or increased their prices (Gimena, 2019).
These circumstances proved that poverty in the Philippines worsened and inequality was even
higher than before. According to research conducted by the Philippine Institute of Development
Studies, while excise taxes on fuel goods resulted in a minor increase in poverty incidence, the
first TRAIN package increased poverty among households and individuals across all sectors
studied. This was attributed to rising commodity prices, which partially offset rising factor
incomes. When their family budgets purchased less and fewer groceries, mothers and
homemakers found themselves on the
front lines. Restaurants began to cut corners on
portion sizes or increased their prices. Transport
workers were the most affected by the increased oil
excise, while the entire TRAIN law increased the poverty References:
rate among fishers (De Vera, 2019). De Vera, B. (2019). More Filipinos dragged into
poverty by higher taxes under TRAIN. Retrieved from
https://business.inquirer.net/282231/more-filipinos-
Nevertheless, I hope that these effects are only short- dragged-into-poverty-by-higher-taxes-under-train
term and it will eventually lead us to a more equitable Gimena, A.C. (2019) Revisiting the TRAIN Law.
Retrieved from
and fast-growing Philippine economy conducive to a https://www.grantthornton.com.ph/insights/articles-
and-updates1/lets-talk-tax/revisiting-the-train-law/
life worth living.
