Press Release
September 9, 2011

Not one 'promdi' subsidizing MRT-LRT riders

Sen. Ralph G. Recto yesterday said people in the provinces need not worry about their taxes going to the fare subsidy of commuters in state-run Metro Rail Transit (MRT) and Light Rail Transit (LRT) even as he stressed that it is still Metro Manila that shoulders bulk, if not all, of the fare subsidy.

"People in the provinces are not actually complaining nor up in arms over their supposed subsidy of MRT-LRT riders in Metro Manila, because it's not true," Recto, Senate ways and means committee chair, said.

Recto said, in fact, it's the other way around since most of the taxes raised by the government are contributed by folks and industries in Metro Manila, which are then plowed back into the poor provinces.

He said taxes paid by Metro Manila residents are returned to them in the form of fare subsidies that run up to P6 billion to P8 billion a year.

"No one in the province like in Batanes, Batangas or in Capiz, Tarlac and even in Tawi-tawi is subsidizing a rider in Metro Manila. In fact, it's Metro Manila that is subsidizing the P39.4-billion CCT program that would benefit most of the provinces," Recto said, referring to the multi-billion conditional cash transfer (CCT) program of the government for 2012.

"When we were campaigning, not one from ARMM ranted about their supposed subsidy of the MRT-LRT fares," he added.

Of the programmed tax revenues of P1.445 trillion in the 2012 budget, a bulk of these would be delivered by people in Luzon and, specifically those in the National Capital Region (NCR).

Recto noted that in 2010, Metro Manila cities of Quezon, Makati, Manila and Caloocan contributed P281.8 billion of the P337 billion that were collected from the 19 revenue regions of the Bureau of the Internal Revenue (BIR).

He said even the combined tax collections from Bicol province down to Tawi-Tawi only amounted to P56.2 billion - which paled in comparison to the Quezon City's collections of P75.8 billion.

He further said the aggregate P23.5 billion taxes collected in five Mindanao revenue regions in one year only represented the eight-month collection performance of the city of Manila.

"And remember the LTS - Large Taxpayer Section - which collected P457 billion in 2010 is NCR-based and a great chunk of this is attributable to income generated in Metro Manila," Recto pointed out.

On a practical note, Recto reiterated that raising fares would only worsen the traffic situation as more riders opt to go down to take buses for their short trips in order to save fare money.

He said this would further swell up EDSA and even create more pollution as operators deploy more buses to take advantage of the avalanche of riders.

The senator pointed out that raising fares in MRT-LRT during these hard times would be squeezing dry the Metro Manila-based middle class who are the "pistons" of the economy.

"We are squeezing the people in Metro Manila -- the middle class, particularly the professionals, office workers and students," Recto said.

He said the timing is off since inflation or cost of goods like petroleum and electricity is relatively high while the economy hardly grew in the second quarter of the year.

Recto nevertheless said there's no urgency in raising the MRT-LRT fares.

"I'm not against raising the fares but there should be an improvement first in the service like additional rolling stocks or coaches. Caving in to a fare increase now would be tantamount to rewarding inefficiency," he said.

He also said the urgent things to do are to close and operationalize the 'loop' between the MRT and LRT systems and improve the service by cutting down long lines and turn-around time.

"The best way to raise revenues is to make the economy grow, create more jobs and send people back to their work," Recto stressed.

News Latest News Feed