Comprehensive Tax Reform Program: TRAIN Law’s Involvement in Enhancing the

Philippines’ Education, Healthcare Services and Infrastructure towards Social

Development and Economic Development

By: Ma. Victoria Cinco Ongtawco

Marynelle Labrador Sevilla

The Comprehensive Tax Reform Program (CTRP) is a fulfillment of President Rodrigo

Duterte’s promise of tunay na pagbabago. The CTRP addresses the inequalities, complexities
and inefficiencies of the entire tax system. The Republic Act No. 10963 otherwise known as Tax
Reform for Acceleration and Inclusion (TRAIN) Act, is the first set of the comprehensive tax
reform program. Raising revenues to finance the government’s priorities is the ultimate goal of
the said package, including producing quality graduates by providing free education in State
Universities and Colleges, providing facilities and better healthcare services, and development of
infrastructures. Aside from this, Diokno declared that Package 1’s provisions include lower
personal income tax rates to increase the salaries of most Filipinos, wider VAT base, to increase
imposed taxes on petroleum products and vehicles, and the introduction of taxes on sugar-
sweetened beverages (Italiano, 2018).

Enhancing the Philippines’ Infrastructure and the involvement of TRAIN Law

The Build, Build, Build (BBB) Program was instigated by President Rodrigo Duterte and
is one of the ongoing programs of the current administration under the newly signed TRAIN
Law. It is referred to as the government’s “Most ambitious infrastructure plan” in an article
written by Marasigan (2017) and is currently given the most priority among all programs.
According to an article of Nunez (2017), seventy percent of the estimated revenue is intended to
fund the massive infrastructure program which includes potable drinking water in all places and
sports equipment for public schools, among others. (P. Alvarez, posted interview, July 12, 2018).
The government has therefore confirmed 75 priority infrastructure projects in line under the BBB
program. Mostly consisting of roads, bridges and airports that are seen to aid and enhance the
economy, most especially in the remote communities of Mindanao.
 As stated in Mawis’ article (2018), the main projects in accordance with the program
includes: the Subic to Clark Railway, the North to South railway projects that connects Laguna,
Manila, Los Baños, Clark Freeport in Pampanga, Tutuban and a 1,500 hectare industrial park
located in Clark, Pampanga and an expanded Clark International Airport in Pampanga as well.
At present, there are 36 ongoing infrastructure projects. The government is most likely to spend
about Php8.4 trillion to construct, modernize and repair new and old infrastructures which are
mainly focused on the development of transportation facilities throughout the Philippines over
the succeeding years based on the Marasigan’s article (2017). The mentioned program seeks to
improve production and develop industries and roads for mobility in between regions to speed up
trades, air transport that would impel air movement, water transport for the improvement of port
activities and rail transports to lessen urban obstruction that is perceived to generate economic
growth.
The BBB program of the government is expected to create 10 million additional jobs for
Filipinos. It is further complemented by the ‘Jobs Jobs Jobs Caravan' which provides lots of jobs
and opportunities for fellow Filipinos. Whereas, 12,000 job vacancies were offered on the first
mass hiring held last August 12, 2018. (A. Tugade, posted interview, February 11, 2019). These
are all intended to escalate the production of the economy, provide lots of jobs, increase profits,
and improve the investment environment that would certainly lead to continuous comprehensive
progress. More or less Php1.097 trillion have been allotted for the said project this year. The
abovementioned accelerated infrastructure expenditures are aimed to be at P8 to 9 trillion within
5 years.

Enhancing the Philippines’ Education and the involvement of TRAIN Law

People are completely aware that education is an important factor in shaping one’s future.
However, not all are given the privilege to enjoy this luxury and study specifically in tertiary
education. Apart from financial complication, the lack of sufficient learning facilities and
classrooms are some of the reasons as to why students opt out of education. Institutions of
Higher education needs adequate funds to make sure that they would be able to offer excellent
education to aspiring professionals. With the recently implemented Republic Act No. 10963,
simply known as the TRAIN Law, such problems will now be addressed as the said act aims not
only to provide funds for more infrastructure, but intends to grant resources for priority projects
to guarantee quality education as well. But in spite of the low tuition fees in public universities,
students yet have to deal with the cost of living particularly those who are from other localities.
This has further caused some students, even those who belong to the middle-class family, to run
the risk of dropping out of school. TRAIN Law has been an essential aspect of the extensive
implementation of Republic Act No. 10931 or the Universal Access to Quality Tertiary
Education Act. As stated by J. Prospero De Vera, the Commission on Higher Education Officer-
in-charge, on Montemayor’s article (2018), a Php 40 billion budget for the initial enactment of
Free Higher Education came from the income produced by the said law. Furthermore, 30 percent
of the revenue of the aforementioned law will be allocated alone to support the Universal Access
to Quality Tertiary Education Act, which includes free education and even free review fees on
courses with bar examinations in State Universities and Colleges and Local Colleges and
Universities, as stated in the article of Nunez (2017). Hence, studying will no longer be an issue
for not only tuition fees would be covered but also Tertiary Education Subsidy will be given to
students who will qualify to the conditions set by the Commission on Higher Education (CHED).
This comprises allowances for books, living expenses, transportation and other miscellaneous
expenses.

TRAIN Law’s involvement in education is constructive for the reason that some of its
profits would be provided to attain a more convenient learning environment with the standard
student to teacher and student to classroom ratio. According to an article written by Labos
(2018), the said act will be able to fund 629,120 public school classrooms or hire 2,685,101
public school teachers in the next five years. Having to acquire full access to quality education
with a whole lot of developed services and amenities, would leave aspirant students with no
reason not to pursue studies at all. Thus, students would gain better opportunities that would
further lead to better income for their families. As what Senator Angara (2017) said, “TRAIN
will help build not only the country's physical infrastructure, but also its human infrastructure.”
Insinuating long term benefits not only for the economic growth of the country, but likewise for
the personal and career growth of a person.

Enhancing the Philippines’ Health Care Services and the involvement of TRAIN Law

The newly implemented Train Law increased taxes on several products such as and
sugar-sweetened beverages and cigarettes which further backs up programs of the Department of
Health that advocates healthy lifestyles to help prevent and lessen the spread of non-
communicable diseases (NCDs) which have been a significant expenditure for Philhealth for
previous years, DOH Secretary Duque said in Jamaylin’s article (2017). Thus, the Department of
Health has been very vocal about their support to the approval of the Train Law. The above-
mentioned law was also responsible for the reducing of the prices of medicines through the
exemption from the 12% VAT. As stated in an article released by DOH (2017), with the
implementation of TRAIN Law, the Philippines became the very first Asian country to launch a
tax rate which administers a tax of P6.00 or P12.00 per liter on all sweetened beverages. As a
result, the World Health Organization praised the country for this. Additional funds generated
through TRAIN law could be used to support the National Government’s Program which could
give more funds for the enhancement of Health Care Services and facilities and to offer
Universal Health Care to all Filipinos. For the next years, there will be expected modernization
of about 704 local infirmary and construction of 25 local hospitals, 2,424 new rural and urban
health clinics and 15,988 new baranggay health centers. From 2017 to 2022, an estimate of
29,466 nurses, 3,288 pharmacists, 2,682 medical technologists, 2,497 UHC, 2,424 doctors, 1,114
dentists, and 911 public health associates are expected to be employed. The TRAIN Law also
seeks to obtain 100% Philhealth coverage at the higher service quality.

Conclusion: TRAIN Law on Social Development and Economic Development

The core objective of TRAIN law is to increase taxes on the commodities at the same
time reducing the taxes paid by the workers. It makes the tax system easier and more efficient.
Workers bring home more money than before because the tax is based on the salary that the
taxpayer receives, and enough funds are also provided for the government’s project.
The implementation of TRAIN Law has a minimal effect on the country’s inflation rate
and translates to more benefits to the Filipino people in terms of better income, health and social
services and increase in infrastructure projects which open more job opportunities in the
construction sector, especially in the countryside.
According to the Department of Finance, individual taxpayers will not pay taxes if
taxable income is below P250, 000, unconditional cash transfers (UCTs) will be provided for the
country’s 10 million poorest households to help them cope with the minimal impact of tax
reform by receiving almost P10, 000 cash assistance for the succeeding three years. Tax Reform
for Acceleration and Inclusion Act’s impact on social development will be seen in the 30%
allocation of generated revenues to social services, which includes education and healthcare
services. Its results may not be seen as an immediate effect since it takes time to produce quality
graduates through funding free education for tertiary levels and improving healthcare services in
the Philippines.
The Philippines’ economic status remains favorable because of the growing domestic
economy. According to Masigan (2018), the consumption of the government, the formation of
capital, and consumer spending are the economy’s drivers. These support the domestic demand
of the country. Revenues generated from TRAIN Act will be divided to 70:30 ratio, the first will
fund the Build, Build, Build program and the latter will be allocated to education and healthcare
services.
Because of the government’s infrastructure program, unemployment and under
employment rate improved for the reason that it created more jobs for the Filipinos. The TRAIN
also increased the income of most Filipinos, making it the reason behind higher consumer
consumption. Increased prices on certain goods because of tax increase may be seen as a threat,
it still helped by cutting off the personal tax of the Filipino spenders. Train law deemed to reduce
the transport cost of goods and services. The government also tries to push the country’s
agriculture industry and “liberalization of the rice sector” (As stated by Diokno in Italiano’s
article, 2018).
As stated in an article of Dar (2018), Lambino outlined that “the implementation of
TRAIN aims to enable fast and sustained economic growth to the Philippines and at the same
time bring progress to every Filipino”, (Lambino, published interview, July 26, 2018). To
accomplish this, the Philippines must maintain its economic progress for the next years, alter the
source of development to investment and empower people to become competitive globally and
further focus in life-long training, infrastructure, education, social protection, health and research
development. By the year 2022, it is expected that the country’s poverty would be brought down
and would ensure safe and secure communities to make the Philippines a middle-income
country.
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