Sunday, October 9, 2011

Assessment of the Suitability of the RP Gov't Decision to Collect VAT on Toll

The Aquino administration would comply with whatever decision the Supreme Court (SC) might render over the value added tax (VAT) on expressway toll, a Palace official said yesterday.

“Whatever the decision of the SC, we will respect and we will only implement the decision,” presidential spokesman Edwin Lacierda said, in reaction to the latest petition filed at the SC seeking the issuance of a temporary restraining order (TRO).

He said that this is a second case against the VAT on toll and the judiciary could decide whichever way it wants to after the Court had previously ruled in a unanimous 13-0 verdict that upheld the government’s authority to collect VAT on toll.

“We leave it with the SC. So again, we are just implementing a decision of the SC and it’s up to them whether they want to change their decision on the matter or maintain their previous position,” Lacierda said.

The previous SC ruling has been rendered final and executory.

“Our obligation is to enforce the law. Kung walang (if there’s no) TRO, we will continue imposing that VAT. Kung may TRO naman (but if there’s TRO), of course, we will certainly respect the TRO of the SC.”

The Bureau of Internal Revenue (BIR) started collecting the 12 percent value-added tax (VAT) on toll fees last Oct. 1 despite the pending appeal on its imposition.

In July, the SC ruled on the legality of VAT on toll fees. In the same ruling, the Court lifted the TRO it issued on Aug. 13 last year on the imposition of the tax.

It also upheld the power of the executive branch to impose VAT on franchise grantees like tollway operators.

Meanwhile, another group has joined the bid to convince the SC to reconsider its ruling.

In a petition for intervention, concerned citizens calling themselves as Taxpayers’ Unity vs. Toll Hike in the South Luzon Expressway (Tutol-SLEX) reiterated the argument that the new measure is a form of “double taxation.”

They cited Article VI Section 28 of the Constitution, which states that, “the rule of taxation shall be uniform and equitable. The Congress shall evolve a progressive system of taxation.”

Petitioners said this means the burden of taxation should be on those who are better able to pay, not on the general public.

“Regressive taxes like the VAT on toll will only worsen the poverty and suffering of our kababayans. The VAT on toll will make the burden of a lack of a significant wage hike and soaring prices of basic commodities and services even heavier,” the group lamented.

Monday, September 26, 2011

Economic growth theories

Now, we will take a look at growth theories and how they have evolved. There are basically three economic growth theories that currently have believers.

First, the classical growth theory links population growth to the productivity of labor. Neoclassical growth advocates believe that real GDP growth is primarily a function of technology breakthroughs.

Finally, the new growth theory states that while technology is the main driver of productivity increases, there are barriers that prevent the standard of living in countries from equalizing.

Classical Growth Theory

This is the oldest theory of the three. It basically states that the economy has a subsistence level that it will revert to whenever productivity increases. If there is a technological breakthrough that brings the productivity of workers up across the nation, then the population will simply expand until the productivity reverts to the previous level.

The conclusions you can draw from this theory are relatively straight forward. The long run equilibriums or real GDP per capita and growth rate of real GDP per capita are both zero. This means that any deviations from the real levels of these two measures are temporary.

Neoclassical Growth Theory

This is a more modern approach to growth theory. Two forces come into play in this theory. Concerning the population, as incomes rise the opportunity cost of birthing children increases. This is because of the time associated with raising children, maternity leave, and other factors.

Also, as incomes rise, the standard of living and life expectancy follows suit. These two conflicting forces offset one another, and therefore, it is hypothesized that economic growth has no effect on population growth.

Therefore, there must be another factor that can make a difference in the growth of productivity. Technology is the factor that this theory chooses as the driving force behind productivity growth. This makes sense, since technological advances can be credited with huge increases in productivity.

Just think of what happened when light bulbs, steam engines and automobiles were invented. These all provided huge returns and increases in productivity. The computer, however, has not had the expected impact on productivity – yet. Sometimes it takes awhile for a change in technology to change the way people work.
There is one final aspect of the neoclassical growth theory involving standard of living. It postulates that as countries gain access to the same technologies, their standard of living will converge.

New Growth Theory

As you recall from the neoclassical growth theory, the theory predicts that standards of living will converge as countries gain access to the same technologies. However, this does not hold true in practice. Countries maintain their impoverished status despite apparently having access to the same technologies that wealthy countries do. The new growth theory attempts to explain this discrepancy.

The new growth theory explains this by including motivation factors in the economic model. Basically, the theory suggests that the more motivation there is for people to pursue innovative ideas, the more creativity will be fostered. This is directly related to the rate of technological advancement. Although breakthroughs appear to be random, they are actually related to how much capital is allocated to providing incentive to innovate.

When he's not playing racquetball or studying for a class, Clayton Reeves enjoys writing articles about entrepreneurship. He is currently an MBA student at the University of Missouri with a concentration in Economics and Finance.

 -----JVA-----

Sunday, August 28, 2011

RP National Income Acts



PER CAPITA: GROSS DOMESTIC PRODUCT, GROSS NATIONAL 
PRODUCT, and PERSONAL CONSUMPTION EXPENDITURE
Annual 2008 and 2009
AT CURRENT AND CONSTANT 1985 PRICES, IN PESOS
 
* - 2000 Based Population Projections, National Statistics Office
Source: National Statistical Coordination Board (NSCB)

PER CAPITA: GROSS DOMESTIC PRODUCT, GROSS NATIONAL 
PRODUCT, and PERSONAL CONSUMPTION EXPENDITURE
Annual 2009 and 2010
AT CURRENT AND CONSTANT 1985 PRICES, IN PESOS
* - 2000 Based Population Projections, National Statistics Office
Source: National Statistical Coordination Board (NSCB) 
Source: National Statistical Coordination Board (NSCB)
What is GNP?
Gross National Product (GNP) is the market value of all products and services produced in one year by labor and property supplied by the residents of a country. Unlike Gross Domestic Product (GDP), which defines production based on the geographical location of production, GNP allocates production based on ownership.

GNP does not distinguish between qualitative improvements in the state of the technical arts (e.g., increasing computer processing speeds), and quantitative increases in goods (e.g., number of computers produced), and considers both to be forms of "economic growth".

What is GDP?
Gross domestic product (GDP) refers to the market value of all final goods and services produced in a country in a given period. GDP per capita is often considered an indicator of a country's standard of living.

GNP vs. GDP
Gross National Product (GNP) is often contrasted with Gross Domestic Product (GDP). While GNP measures the output generated by a country's enterprises - whether physically located domestically or abroad - GDP measures the total output produced within a country's borders - whether produced by that country's own firms or not.

When a country's capital or labor resources are employed outside its borders, or when a foreign firm is operating in its territory, GDP and GNP can produce different measures of total output.
-----JVA-----

Sunday, August 14, 2011

US Economic Crises

Actually the strength of bid for govt debt even in countries like the Us and UK given their current poor fiscal position is very worrying because of what it really signals.

It is signalling that a great deal of the world from individuals to companies and now to countries have become very risk averse to the degree where capital preservation is completely overshadowing the issue of return on capital.The big problem with this mindset is what it bodes for any increase in investment and expansion without which job growth is going to struggle.

This appears to be a backlash from 2008 that is simply creating a very poor macro economic picture. These markets are being supported by the big banks and the Fed to generate confidence but the numbers don't lie. Within ten years your $1,000 bond will be worth $404 at present inflation rates. In that time you will have collected a total of $214 not adjusted for inflation. Inflation is only 11.5% if a) your lone economist is right and b) if you're in the USA. On the whole it's institutions who are buying US bonds in order to diversify their risk. The yield isn't that important in a time of recession when investing in companies is high risk.

As for gold and silver, yes they could rise rapidly. However if the world economies settle down and we have a time of low growth and no shocks their prices will plumit.

Saturday, August 13, 2011

Less money in Uncle Sam's pocket?


United States of America known as one of the powerful country in the world is said to be in its crucial situation. With this stocks hitting down it really affects not only America but also the other countries. Uncle Sams currency is weakening, causing a doubt for investors to put their golds in an unsure hit or situation; and because of this its like a virus that will affect the system. Like the massive rate of lost in employment from middle class down to bottom. Eased concerns that the economy was heading back into recession as feared by investors, and buoyed U.S. stocks. As we look back starting the year of 2000 we have seen that the Americans are so found of using credit line resulting to this years that this debts are putting Uncle Sam’s money to nowhere; like a trash being thrown in the garbage.

Why are we experiencing this? Actually reading the news and seeing this on t.v, If America is experiencing this economic crisis other countries will also encounter this situations and worst it will hit poor countries in a massive pace. If this so will continue to happen; worst poverty is with-in reach and gaining back the lost wealth is a sweat to perspire double time. Can we site some reason why this things happened? From the war to the debts and the prize hikes are some results of economic downfall.


_ANN_

Sunday, July 31, 2011

PNoy's second SONA


"Let us stop pulling our fellow man down. Let us put an end to our crab mentality. Let us make the effort to recognize the good that is being done."

"Let us end the culture of negativism; let us uplift our fellow Filipinos at every opportunity."

"If you see something right, do not think twice—praise it."

For me this is the best part Pnoy had said in his SONA. Not the " wangwang" thing which it was almost the center of his speech. Although the wangwang did help a lot in the society most specially in roads it lessen of giving VIP treatment to the authorities and to the traffic violators but still this is not the real problem of our society. There are a lot of things that should be observe and do something to solve the problem. There are also some issues that he didn't talked about like the RH BILL and the DIVORCE BILL and he didn't even shared his plan for the next five years and we are all clueless.

But as a whole it wasn't bad at all. He used our own language and stood up in front of many Filipino people with confidence. In his statement we have heard that there is a progress in our country and we couldn't question that because we also can see through our own eyes.

It is a great start for PNoy and I hope that he could continue and do his promises he had made to us. And I know he could not do this alone that's why we Filipino citizens should also do our part to help our country to have a better society and it will only happens if we ourselves knows what to do and choose the right thing.

-DEA

P-Noy 2nd SONA

President Benigno " Noynoy" Aquino III has deliver his second SONA last  July 25, 2011 at the Batasang Pambansa.

President Benigno “Noynoy” Aquino III seemed to have pleased the audience of his second State of the Nation Address, as he received more applause than he did last year.

He received the longest round of applause when he said, “Malinaw ang pahiwatig natin ngayon sa buong mundo: Ang sa Pilipinas ay sa Pilipinas.”

He added that the Philippines is ready to defend what really belongs to the country and that the government is considering to bring the case of the West Philippine Sea to the International Tribunal for the Law of the Sea.

The newly appointed Ombudsman former Supreme Court Justice Conchita Carpio-Morales was also lauded by the audience.

“Inaasahan ko nga po na sa taon na ito, masasampahan na ng kaso ang lahat ng nagkuntsabahan sa katiwalian, at naging sanhi ng situwasyong ating inabutan,” Aquino said.

Aquino received loud reactions from the crowd when he disclosed that PAGCOR spent one billion pesos on coffee which amounted to 10 million cups of coffee in a year.

Baka po kahit ngayong iba na ang pamunuan ng PAGCOR ay dilat na dilat pa rin ang mata ng mga uminom ng kapeng ito. Hanapin nga po natin sila, at matanong: nakakatulog pa po ba kayo,” the president said, inserting sense of humor in his speech.


Im quite satisfied for his accomplishment for a one year in service.President Noynoy Aquino refers “wang-wang” as graft and corruption, abuse of power, and other illegal activities of some government officials and even from the private sector.

“Midnight bonuses” at some government corporations, his discovery of PCSO’s billion-peso worth of coffee expenditure during the past term, the multi-million peso unliquidated cash-advances within DPWH, which now incumbent Secretary Singson is running after, along with a string of other anomalies; and the alleged rigging of the 2004 Presidential elections in ARMM, which his administration now actively investigates represent his will to reform the corrupt government he was handed down with.

Hope he will continue to serve the Filipino people with honesty and integrity.