MANILA - While Congress sits on a bill to amend an excise tax law on alcohol and tobacco products, the House committee on ways and means on Tuesday unanimously approved a measure imposing a tax on text.

Both revenue measures are expected to contribute additional P20 billion annually.

The text tax bill imposes five-centavo excise tax on every short message service, multi-media service sent from mobile phones and on every overseas dispatch, message or conversation originating from the Philippines.

No pass-on

The still unnumbered consolidated bill made sure the additional tax will not be shouldered by the mobile phone users. "No pass on. It won't be charged to the users," said Quezon Rep. Danilo Suarez, one of the measure's proponents.

Suarez's House Resolution 282 was consolidated with deputy Speaker Eric Singson's House Bill 6625.

"We are very emphatic. We approved it on condition that there will be no pass on provision. We wanted to make sure that we do not burden the consumers. In the law itself, we made it a point that the tax will be borne solely by the telecommunications company," added committee member Isabela Rep. Giorgidi Aggabao.

The measure was also supported by House Speaker Prospero Nograles and majority leader Iloilo Rep. Arthur Defensor.

"There will be no additional cost on texting. Based on our estimates, our telcos still rake in a lot of profit at a cost of 50 centavos per text. So instead cutting down on the cost of texting, telcos should allocate at least 20 % of their profit to a trust fund for education and health care. It is my position that the proposed additional tax on text will be borne by the service providers and that the consumers will not be paying additional costs for texting," Nograles said in a statement.

"I support the House leadership’s stand of not passing such additional tax burden on to the texting public," Defensor said.

Battle with the telcos

Suarez acknowledged that he's expecting difficulty in getting the measure passed. The bill awaits plenary deliberations and approval.

"I expect a difficult time with the telcos... I know what they will do. They will question this in the Supreme Court," Suarez said.

But Suarez said he's hoping that his proposal to earmark the funds for nationwide computer literacy programs will make the bill more acceptable to the telcos. His bill pushes to allocate the funds to include computer science subjects in the curriculum of public schools.

He said this will benefit the telecommunications industry, anyway.

"We have to address the academic crisis. As I've always been saying, this law should have been passed a long time ago. If we will not do this, the problem will always be there. Ang naging wake up call ay yung report ng BPO. Nakita mo napakaganda ng revenue kinita ng service providers in the area of back office, documentation, medical transcription, and animation. Andami. Pero you have to be a computer literate to be employed in that particular industry. You will be running out of qualified workers," Suarez said.

"With this noble intention baka hind na labanan," Suarez said.

Budget deficit

This tax measure is expected to help plug the country's budget deficit, which is expected to reach P250 billion, or 3.2% of gross national product this year.

Key revenue collecting agencies have missed revenue targets, putting pressure on the budget deficit. In the first 7 months of the year, the deficit already reached P188 billion, or three-fourths of the full year target.

Earlier, the Finance Department said they have made a compromise with lawmakers--specifically with members of the House committee on ways and means--to defer the passing of the sin tax reform law.

Cited as reasons included the worldwide liquidity squeeze and the need to keep jobs.

At its current form, the sin tax law has led to actual collections way below the revenue promises.

A more unified sin tax measure was supposed to bring in at least P20 billion this year.

The recently approved text tax in the House is expected to bring in the same amount.