BACKBENCHER
Rod Kapunan
10/8-9/2011
Anybody with common sense could tell how the Supreme Court lost track of what it is supposed to do when it lifted its restraining order to stop the collection of the 12 percent value-added tax imposed on motorists using the country’s expressways. The government insists it needs additional revenue of between P2 billion and P3 billion to narrow the widening budget deficit. As usual, it is the people who are made to bear the burden.
Reexamining the current opposition, one would realize that the amount is only incidental. The indignation of many is why the High Court legalized the collection of tollway fees by the private operators. The question may sound philosophical, but knowing the wisdom behind the law is the only way to guide the courts to let the public understand that the exaction is “for their own good.”
That is supposed to be the case because there are basic obligations the state must undertake to justify its existence. It is its ability to carry out those obligations that justifies its right to collect taxes. To ensure that they are not hindered, the people entrust their government some extraordinary powers as those obligations are for their common good. One is the power of eminent domain.
Originally and as today, that power is exclusive only to the State. Although eminent domain pertains to the confiscation of real property for public use, the government nonetheless is committed to pay just compensation. This we must understand because road and bridge construction is essential to commerce, and is considered the lifeblood of the nation.
But when the father of the country’s privatization sold in 1994 the North Luzon Expressway to the Lopezes, he squarely placed in grave doubt that wisdom. Certainly the former owners of those escheated properties would not have meekly parted away with their lands had they anticipated that the government would sell them, just as they are now shouting to high heavens as they see those private tollway operators raking in much profit while the government imposed an additional burden called VAT to support itself.
The stupid “privateers” would argue that since the expressways are now in private hands, they have the right to impose VAT on services for income above P1.5 million a year. If so, then who told them to sell them when the government could have earned more in direct earnings had it retained ownership of those expressways following the logic that percentage-wise profit will always remain bigger than taxes? It is on this score that sensible Filipinos say the privatization of the expressways is a clear circumvention of the power of eminent domain.
The first decree, Presidential Decree No. 1005 issued on September 22, 1976 by then President Marcos allowed the reasonable collection of toll, but on a self-liquidating basis. That means fees will have to be collected to defray the cost advanced by the contractor, but should automatically stop upon full payment. Subsequently, P.D. No. 1112 issued on March 31, 1977 created the Toll Regulatory Board to regulate and check the amount collected from motorists. The same decree was amended by P.D. No. 1649 issued on October 26, 1979 authorizing the establishment of toll facilities on public improvements, and amending the Toll Regulatory Board.
The commuting public would not mind being charged an amount to defray the cost for its construction and a minimal amount for maintenance, but not for a private entity to continually amass profit out of the misuse of that extraordinary power that left them with no choice but to cede their properties. The motorists and the indignant commuters are asking whether there is a derivative power arising in the exercise of eminent domain like the power of the private expressway operators to collect toll fees. Their argument stems not from any socialistic sentiment, but out of plain logic that eminent domain is an instrument of the state, not of the private sector, so to put an order to our system of free enterprise.
The privatization of the expressways, like many of those industries sold by the Ramos administration, would obviously demand not just the maintenance of the toll, but would insist as a condition precedent the deregulation of their rate. That was bound to happen for then the concept of public service for the common good automatically ceased. Thus, it came as no surprise why right after the government-owned NLEX was handed to the Lopez-owned First Philippine Holdings, the toll was astronomically increased, by more than 1000 percent, from P21.50 to P218 from Balintawak to Sta. Ines.
Of course, the buyer-company carried out improvements, but just the same it was the public that shouldered the cost, notwithstanding that part of the funds used came in the form of a foreign loan. It is no longer a case of them required to use their profit to recapitalize their business or to borrow for additional capital to comply with their obligation pursuant to the grant of franchise.
The deregulation of the tollway fees contributed much to the unreasonable increase in the prices of goods and services. The corresponding inflation explains why the amount printed on the face of those paper bills has tremendously increased, but not its value. Having been made a permanent fixture, it is now the government that has to pathetically beg and justify the demand of the private operators so to raise its share in the VAT. In effect, the government now stands as co-principal in gouging the motorists for higher tollway fees.
Besides, the continued increase of the tolls is a limitation on the right of the individual to freely travel, except in the interest of national security, public safety or public health. Such interpretation of Section 6, Article III of the Constitution is not borne out of one’s fertile imagination, but rooted on the same postulate that the state is obligated to construct roads and bridges to allow people to freely travel for business, for family visitation, for religious pilgrimage or for the joy of traveling, and the driving force why they have to pay taxes.
The power of eminent domain is a residual right to our freedom to travel, and not the other way around. Sadly enough, our courts have totally forgotten if not ignored this constitutional mandate. So, as tollway fees continually increase, the courts wittingly or unwittingly allow the private operators to use that power to violate our sacred right to travel without restriction.
(rodkap@yahoo.com.ph)
