NECESSITY

Topic: Let it Be resolved that the TRAIN LAW should be abolished at this time. (Negative
Side)
Speaker: Luke Sanchez

Good afternoon ladies and gentlemen, “Nothing is forever, except change.” The wise
words of Buddha proclaim the undeniable truth that the only thing constant is change. The Tax
Reform for Acceleration and Inclusion Law (TRAIN Law), formally known as Republic Act No.
10963, is the first package of President Rodrigo Duterte's Comprehensive Tax Reform Program
(CTRP), which was signed into law on December 19, 2017. The TRAIN aims to make the
Philippine Tax System simpler, fairer, and more efficient to promote investments, create jobs,
reduce poverty. The reform also reduced personal income taxes and other tax rates and imposed
higher excise taxes on automobiles, petroleum products, tobacco, sugar-sweetened beverages and
other non-essential goods. Honored adjudicators and guests I am here today to discuss why there
is no need for the TRAIN Law to be abolished this time.

My first point is the poor will have less access to social services. According to the
Socioeconomic Planning Secretary Ernesto Pernia, the reform has increased the government's
fiscal space to finance the "Build, Build, Build" initiative and other social services such as
conditional cash transfers (CCT), free tuition in state universities and colleges, free irrigation for
growers, and more. There is no need to abolish the TRAIN Law because the poor depend on it.
The conditional cash transfer (CCT) program locally known as Pantawid Pamilya Pilipino
Program or 4P’s provides cash transfers to poor households. The objective of the program is to
promote investments in the education and health of children to help break the intergenerational
transmission of poverty, while providing immediate financial support to the household.
According to the World Bank The program benefits about 20% of the population, the majority of
the nation’s poor. Their study estimates that the program has led to a poverty reduction of 1.4
percentage points per year or 1.5 million less poor Filipinos. Recent data from the Philippine
Statistics Authority Philippine in 2015 to 2018 poverty went down by a significant 6.6
percentage points thanks to sustained economic growth and reforms, the government said. 

My second point is Filipinos can have more savings and investments. TRAIN is the first
step to once and for all correct our unfair, complex, and inefficient tax system. After 20 years, it
updated the personal income tax rates which burdened mostly our ordinary employees earning
above minimum wage up to P500,000 in annual gross salary and were being taxed up to 32%
under the old tax system. According to the Bangko Sentral ng Pilipinas' Quarterly Consumer
Expectations Surveys, approximately 40% of households with incomes ranging from P10,000 to
P30,000 had savings as of the fourth quarter of 2017. This means that the money that comes
from tax exemptions can give great help in their savings and investment to human capital in this
time and there is no need for the proposition to abolish the TRAIN law.

For my third point, the TRAIN law is essential for the country’s economic development.
The reform increased the fiscal space to finance healthcare, education, and enhance social
services. TRAIN already helped people especially the people with diabetes, high cholesterol, and
hypertension by giving VAT exempt on their medicines effective last January 1, 2019. To help
Filipinos cope with the changes brought about by TRAIN, Unconditional Cash Transfers (UCT)
is a social measure to alleviate the impact of fuel excise increase on the poorest 10 million
households or individuals. As of April 12, 2019, more than PHP 22 billion has been distributed
to more than nine million beneficiaries. The reform also helped the education of the poor
significantly. TRAIN is crucial to the full implementation of Republic Act No. 10931 or
Universal Access to Quality Tertiary Education Act. The reform added 16 Billion in the pockets
of the families of some 1.3M students in 112 SUCs and 78 Local Universities and Colleges
(LUCs) due to free tuition, miscellaneous and other school-related fees. If TRAIN is suspended,
Filipinos who benefit from healthcare, social service and education measures will lose access or
it will have the burden of cutbacks.
 BENEFICIALITY
Topic: Let it Be resolved that the TRAIN LAW should be abolished at this time. (Negative
Side)
Speaker: Angel Grace Moderacion

I am the second speaker of the negative side speaking under the beneficiality of the
Proposition.
 
I STRONGLY DISAGREE THAT THE TRAIN LAW MUST BE SUSPENDED DUE TO THE
FOLLOWING REASONS:

TRAIN implementation aided the government in dramatically increasing tax receipts, while the
passage of the 2020 national budget guaranteed that public money was spent wisely on priority
and critical programs and projects.

The TRAIN bill increases taxes on cigarettes and sugar-sweetened drinks, which will fund DOH
initiatives promoting healthy lifestyles and the prevention and control of noncommunicable
illnesses (NCDs). The bill also helps the DOH's effort to reduce drug prices by exempting all
drugs needed to treat diabetes and high cholesterol from the 12 percent VAT. The DOH will
monitor medication pricing to ensure that the VAT exemption on medications results in lower
pricing for customers.

According to Finance Secretary Carlos Dominguez III, we should look back at what preparations
the Congress allowed us to do in order to get out of the COVID scenario and prepare for it. And
that was a real tax reform. This, in my opinion, is an excellent illustration of why tax reform
works. President Duterte's fiscal prudence and care in state expenditure policies, as well as the
budget and TRAIN approval, have ensured that the Philippines is "financially competent" to
overcome the significant cash gap necessary to defeat COVID-19.

Lower income tax rates were intended to provide Filipinos more discretionary income, perhaps
increasing domestic spending. The TRAIN will also generate revenue to support much-needed
social and physical upgrades essential to sustain rapid economic development. In light of these
developments, several international organizations and rating agencies changed their economic
forecasts for the country. While the government has assured the public that the TRAIN's
inflationary impact will be small, the central bank has conceded that it may raise rates if
secondary impacts such as increased price of consumer goods indirectly affected by the TRAIN,
and also a need for higher wages, drive inflation over target.

We believe we should continue to campaign for comprehensive tax reform, because tweaks to
help those affected by COVID-19 may be possible. Failure to implement tax reform would need
further borrowings as the need for Filipinos' emergency aid ros
 NON-PRACTICALITY

Topic: Let it Be resolved that the TRAIN LAW should be abolished at this time. (Negative
Side)
Speaker: Erickson Espayos

Fair Adjudicators, Moderator, and debaters, Good Afternoon. Allow me to additionally stress
and advance the notable focuses and contentions that discussed by the previous speakers of my
group that the TRAIN LAW should not be abolished at this time.

         On December 19, 2017, President Rodrigo R. Duterte endorsed into law Package 1 of the
Comprehensive Tax Reform Program (CTRP) otherwise called the Tax Reform for Acceleration
and Inclusion (TRAIN) as Republic Act (RA) o. 10963. The Law took effect on January 1, 2018.

The TRAIN expects to make the Philippine Tax System less difficult, more pleasant, and more
proficient to advance speculations, make occupations and decrease destitution. Alongside this
level headed, the CTRP additionally intends to raise incomes that will finance the President's
Build, Build, Build Project that will support high and comprehensive development of the
country; and money interests in our kin through upgraded instruction, wellbeing and social
administrations.

TRAIN 1 decreased personal income taxes after 20 long years of non-adjustment of tax rates;
however it forced higher extract charges on autos, oil based commodities, tobacco, sugar-
improved drinks and other unnecessary products. The lawmakers planned that with individuals'
help, every one of these changes will at last bring about lower costs, more open positions and a
more promising time to come for every single Filipino.

The TRAIN Law's first package affects three major categories: economic growth, job creation,
and the effect on inflation. The DOF expects the economy to expand by 1.3 percent by 2022,
with 0.42 percent inflation as a result of the excise tax hike (this is still within the Bangko
Sentral ng Pilipinas' (BSP's) 2-4 percent target inflation). It also plans to generate half a million
employment over the next ten years and eight million over its full lifespan, as well as to bring
250,000 Filipinos out of poverty. Package 1 would be able to raise Php134 billion from the
increase in excise tax. The real impacts in 2018 are discussed further below.
 
The government was able to generate Php619.84 billion in the first quarter of 2018. In
comparison to the first quarter of 2017, this indicates a 16.4 percent increase in revenue. In terms
of money, the government was able to raise Php87.44 billion more this quarter of 2018 than the
previous year."The Philippine economy increased by 6.8 percent in the first quarter of 2018,
maintaining its position as one of the region's fastest-growing economies, despite rising prices,
which decreased consumption and productivity in some sectors." Formalized paraphrase DOF
Secretary Carlos Dominguez III reported that tax receipts increased by 18.2 percent, "exceeding
the 9.7 percent nominal GDP growth."
The Bureau of Internal Revenue and the Bureau of Customs both witnessed rapid revenue
increases as a result of Package 1, with 14.2 percent and 24.7 percent increases, respectively.
This equates to a total of Php423.1 billion and Php129.8 billion for both departments. Because of
the rise in revenue, other government agencies were able to raise their investment and growth
during the first quarter as well.

In terms of expenditures during the first quarter of 2018, the total came to Php782.0 billion,
increasing by 27.1 percent, outpacing nominal GDP growth of 9.7 percent due to an expected
40.0 percent rise in capital outlays. Dominquez also stated that the expenditure effort increased
by 2.73 percent, the largest rise since 2003. As a result, the contribution to GDP growth is
greater. As a result, revenue effort increased by 0.91 percent. Furthermore, public construction
increased by 25.1 percent, contributing 0.4 percent to GDP growth. Government consumption,
on the other hand, climbed by 13.6 percent, providing an additional 1.4 percent to GDP growth.
"'Strong macroeconomic fundamentals supported by tax changes and the Build, Build, Build
program will continue to drive economic development to the optimal 7-8 percent level as the
economy's efficiency improves and more jobs are created."