According to Kofi Annan, former Secretary General of the United Nations, Knowledge is power. Information is liberating.

Education is the premise of progress in every society and in every family. For undeniably, Information is a powerful tool, of which people often fail to seek. It is by nature that we, Filipinos insistently recognize and accept rumors while failing to seek for the truth. Sadly, people habitually settle for unsubstantiated information which frequently causes irrational and arbitrary opinions. Taking for instance yesterdays events: following the strong magnitude of the earthquake yesterday, were precautionary protocols done by the Philvolcs for a possible tsunami incidence towards the island of Negros. As a result of hearsays, people panicked and rumors circulated like fire around the City. Weve seen people packing and bringing their valued properties, including their livestock goats and pigs. All means of transportation were filled with clamoring people at the attempt to move to higher grounds to the west. Fortunately, no one died but a few were injured. The experience only proves that misinformation would always, always lead to a distorted and erroneous assumption. Thus, the importance of education and proper communication is a key to attaining progress in our society. In the Philippine context, Taxation, especially the Extended Value Added tax or E-Vat is one of the most usual victims of false assumptions and mislead interpretations. Thus, a full understanding of its functions and benefits to the State as a whole is vital for the delightful involvement of its people. The extended value-added tax law is one of the most recent instruments of fiscal reform in the Philippines. This recent law implemented taxation on commodities that were tax-exempted in the precedent years; to name a few are Importation of Coal, Petroleum, Electricity and Services. Aside from the aforementioned, the law also increased sin taxes, or taxes on alcoholic beverages and cigarettes. In addition, corporate tax also moved from 32% to 35%. Through this new law, the government is able to obtain additional revenues. Just as Press Secretary Ignacio Bunye stressed that the people need not worry since basic necessities are exempted from the VAT. Fears of any price increase are also misplaced because according to him, External factors, such as the armed conflicts that cause the oil prices to shoot up, are the ones that will make the prices of commodities go up. As regards accusations that VAT is anti-poor, he argued, VAT will not charge farmers and fishermen who are responsible for our produce. Revenues to be generated should the new VAT bill become a law would go back to the taxpayers in the form of jobs, education, water, and health projects. At present, the VAT covers a wide range of goods and services. According to research by Bayan Muna, these include food products (processed meat, canned fish, coconut and vegetable oil, bakery products, noodles, milk, dairy products, coffee, sugar); clothing, footwear, tannery

and leather products; drugs and medicine, furniture, pulp and paper, glass and glass products; cement, steel, iron, wood and most construction materials; electrical lamps and equipment, machinery and equipment both for manufacturing and agriculture, wholesale trade and retail trade, pawnshops, restaurants, cafes and other eating and drinking places; employment and recruitment agencies; motion picture production; hotels and motels, telecommunications (including landline, post-paid and pre-paid mobile phone services. Currently exempted from VAT include raw agricultural products, magazines, public transportation, shipping and apartment units with monthly rental of not more than P8,000 ($145.22). Fees of doctors and lawyers are also exempted while other professionals like accountants, athletes and actors were able to get postponements in the collection of VAT. Taking note of the coverage exemption of the EVAT at 12%, it would not be too heavy for the people if this would be increased to 15% since in the long run, the taxpayers will benefit from what they are paying as well. Time and again, the fact that we are experiencing economic crisis would lead us to assume that increasing the EVAT would be of burden to us. Although the expanded value-added tax implementation will entail monetary sacrifices in the short run, the benefits of this legislation will bring lasting rewards to the Filipinos. The incremental revenues that will come from the additional tax collection will add up to the countrys budget for reforms and infrastructure development. In particular, 50% of the share will be allocated for the purposes of public education, health premiums, environmental conservation and agricultural modernization. With proper implementation of tax collection and budget allocation, the government will be able to address the primary needs of the citizens. Investments in health and education will carry on the benefits of tax revenues to the future generation. At present, Senator Mar Roxas is vying for a Peoples Funda special account in the National Treasury where 30% of the additional tax revenues will be allocated in order to direct the funds to programs on education and health. With larger funds allocated for agricultural modernization, infrastructures in the provinces are expected to improve. In the long run, improvements in agriculture will increase the income opportunities in the rural areas. With the construction of farm-to-market roads and irrigation facilities, markets become more accessible and production costs are decreased. People in the province will not be forced to find greener pastures in the overcrowded cities and instead can be involved with farming. Increased farming activities will provide a food source for the cities and will result to stable price levels of goods because the people will not depend on imported goods anymore. Thus, the additional funds will increase the gross national product of the country and promote more stable prices.

If we could spend our money on less important things, a 3% increase wouldnt harm anyone rather it could be equivalent to so much more assistance in the development of our own country.