Text power to fight SMS tax

Gloria Exekial talks to her children everyday using text messaging.
The Filipino mother of two from Cagayan de Oro, works as a caregiver in Vancouver, Canada and this gives her a lifeline to her homeland.
“It is cheap and my children can use it anytime ... now the government wants to tax it ... have they not taken enough from us overseas workers,” said Exekial.
Exekial, like millions of others overseas Filipino workers, are coming together in a revolution against Manila’s multi-million-dollar plan to tax texting.
The texting revolution, which is led by a consumer group, is warning the country’s 70 million mobile phone users would be unfairly required to carry the burden for a cash-strapped government.
“To rebel against this new tax law is justified,” TXTPower leader Anthony Ian Cruz told local and international media as he warned legislators seeking re-election in next year’s national polls of a backlash.
The bill, proposing a five-centavo (0.1 cent) tax on every mobile phone short and multimedia message, could raise more than half a billion dollars a year for the cash-starved nation.
It has already passed the committee stage of the lower house, and its proponents are now pushing for it to be endorsed fully by parliament and signed into law by outgoing President Gloria Arroyo.
They argue the money would be used to boost the government’s education budget.
But Cruz pointed out that the government already collected a 12-percent value added tax on mobile phone services.
Instead of imposing the tax, Cruz said the government should cut wasteful spending and stem the loss of money through political corruption.
“Congress must exercise restraint in looking for ways and means to finance government programs and operations,” he said.
The Philippines is often considered the world’s text messaging capital, because the country’s 70 million mobile phone subscribers send an average of 10-12 text messages or SMS every day, according to government estimates.
In 2001, text messaging was used to gather tens of thousands of people on to the streets for a peaceful revolution that toppled the graft-tainted presidency of Joseph Estrada.
This week, mobile phone conpanies in the Philippines protested against the text tax proposal after the government said it would throw its support behind the measure as long as the proposed tax was not passed on to consumers, deputy presidential spokesman Anthony Golez told reporters.
The country’s three largest telecommunications companies are opposed to the tax measure, arguing it would be a “big burden” on low-income consumers.
“The proposed tax on SMS is clearly anti-poor and anti-consumer,” said Ray Espinosa, head of regulatory affairs and policy office at the Philippine Long Distance Telephone (PLDT) (TEL.PS), adding that 92 percent of its SMS traffic is generated out of bucket-priced plans.
Bucket-priced plans, designed for low-income consumers, are either unlimited SMS or a pre-determined number of SMS over a defined time period.
Globe Telecom (GLO.PS) shared the view, saying the extra tax would make the low-priced SMS unsustainable, said Rodolfo Salalima, the mobile phone company’s chief legal counsel and senior advisor.
Wary about the possible political impact of the proposed tax on text messages, President Arroyo’s administration in Malacañang Palace last weekend called on lawmakers to revise the measure and spare cell phone users of unnecessary burden.
“If you see objections coming from both sides of the fence, there is really room for further study,” presidential economic spokesperson Gary Olivar said.
“Plus, there’s new information coming from the telecoms. Maybe, some revisions are in order.”
Several senators, including Senate President Juan Ponce Enrile, have also opposed the measure.
Filipino media said overseas Filipino workers are joining the growing opposition to the proposed tax on text messages by the hundreds everyday.
Migrante-Middle East, an alliance of OFWs in Saudi Arabia and neighboring countries, denounced the lawmakers for adding to the burdens of overseas workers and their families.
“This government is killing OFWs and their families so softly,” John Leonard Monterona, Migrante-Middle East regional coordinator, said in a statement.
“OFWs and their families vow to oppose this tax on text messages. Migrante chapters in the Middle East are going to campaign against tax-on-text proponents in Congress in next year’s elections,” Monterona said.
Olivar agreed on the need for lawmakers to thoroughly review the measure in view of new points raised by several sectors on its adverse impact on consumers.
But the consumer group TXTPower has flatly rejected calls by Malacanang to “revise” the text tax bill approved by the House committee on ways and means, demanding no less than the complete scrapping of the proposed revenue measure.
“The correct and moral position is to junk the text tax. At a time of crisis, the least the government could do is not to add to the daily burdens of consumers,” said TXTPower president  Cruz.
“For the majority who are already overtaxed and overstressed by the daily terror of trying to survive on shrinking incomes, any new tax is unacceptable,” said Cruz.
According to Cruz, “not only did the House have the nerve to lie about the so-called no-pass-on provision which does not exist in the approved bill, it is insulting the public by trying to make us all believe that such a provision will prevent telcos from doing accounting hocus-pocus to pass on the text tax to consumers.”
“The Arroyo administration is perhaps the only government in the world to push for a new and regressive tax in the middle of a worldwide economic crisis,” said Cruz. “Instead of helping the people through safety nets, the Arroyo government wants to kill the people through a new tax.”