Recto quits as Senate panel chief over ‘sin’ tax bill version

By Butch Fernandez/ – Sen. Ralph Recto, hurt by a Malacañang official’s allegation that lobby money fueled his recommendation on the “sin” tax bill, on Monday submitted his “irrevocable” resignation as chairman of the Committee on Ways and Means which endorsed adjustments on alcohol and tobacco excise taxes much lower than the Palace’s P60-billion tax-increase proposal.

But Senate Majority Leader Vicente Tito Sotto III asked the body to adopt Sen. Edgardo Angara’s motion that the matter be referred first to the Rules Committee. Recto, who ran for the Senate under the administration party, reaffirmed his decision to also withdraw his committee report to give the next chairman leeway to draft a new one acceptable to Malacañang.

But Senate President Juan Ponce Enrile decided to convene a caucus on Tuesday to take up the matter before
rendering a final ruling on Recto’s resignation over lobby fund allegations.

Tuesday’s caucus is also expected to act on Enrile’s suggestion to open an independent inquiry into reported charges made by Presidential Legislative Liaison Officer (PLLO) Manuel Mamba that lobby money swayed Recto’s committee report in recommending an incremental P20-billion sin-tax version, that was also supported by other senators. The House-approved version set a P31-billion additional revenue target on adjusted sin-tax rates.

Enrile also appealed to Recto not to give up his post; the Senate chief said while he himself does not easily “get riled by accusations like this, we have a duty to protect the integrity of the Senate.”

“We will give them [PLLO] a chance to show us if there is, indeed, a lobby money,” Enrile said. He said he was also provided with documents indicating that “there is also lobby money on the other side” favoring higher excise taxes on alcohol and tobacco products. “I don’t think Malacañang can fault us for doing our legislative duty. But the Palace should know senators also have honors to protect.”

Sen. Ferdinand Marcos Jr. said the Senate couldn’t do its work under “this kind of doubt.”

“[And] If we simply follow the Palace recommendation, we become a rubber stamp,” Marcos said as he objected to the withdrawal of Recto’s committee report. He said he found it “repugnant that the Office of the President could cause a chairman to withdraw his Senate committee report because they disagree with it.”

But Recto clarified there was “no pressure from the Palace” and it was his personal decision to resign from the committee. “It would be untenable for me to defend a measure that the Palace criticized. Wala ng tiwala [No more trust],” he said.

Recto said he found it “untenable for me to continue [sitting as ways and means committee chairman] as the people who will backstop me in the plenary debates on the sin-tax measure are not with me,” referring to officials under Finance Secretary Cesar Purisima and Bureau of Internal Revenue Commissioner Kim Henares.

Taking the floor, Sen. Joker Arroyo noted that the source of the lobby allegation, Mamba, is the PLLO chief who is assigned to do liaison work between the Executive and Congress. “He [Mamba] is supposed to liaison so that legislation will pass smoothly. But it seems all this problem began with the PLLO whose job is to smoothen relations but instead attacked senators for supposed bribery.”

“Why should we be stampeded by the PLLO? He has condemned only one side and in this case, it is the Senate. If Senator Recto resigns, it is as if he accepts, despite his denial, the accusation.”

Arroyo wondered if Mamba could still be effective in his job as Palace chief liaison officer with the two chambers of Congress since “he has become a persona non grata in the Senate.”

But Arroyo advised that the Senate first summon Mamba and query him on the case.

Enrile, in seeking an investigation of Mamba’s allegations, absolved the President of involvement in the alleged lobby controversy.

“To be fair, the President [Aquino] is not involved here. It is his liaison officer who opened his mouth, [who] should be careful with his accusations.”

At the same time, the Senate President conceded that it was Recto’s prerogative if the Senator is really determined to give up chairmanship of the ways and means committee. “He (Recto) is the chairman, if he wants to give it up, can we force him? He already explained his position. He was only doing his duty and he is accused of prostituting his office and it’s a slur. I don’t know about the others but this is a serious charge.”

Enrile said the problem began when the PLLO chief made the lobby allegations against Recto. “I never experienced this kind of accusation, it puts a cloud on the honor and integrity [not only on Recto but other] members of Congress by the man who is supposed to liaise with us here on matters of legislation. And here is the man accusing us, instead of talking to us, as it should have been, in order to smoothen the passage of measures the Palace proposes to Congress.”

“Because Senator Recto lowered the tax, is he a thief? And are we all thieves if we don’t pass [the sin-tax bill]? Are we going to take this kind of pressure [from the PLLO]?” Enrile asked.

But Sen. Frank Drilon, another so-called administration legislator, defended Malacañang’s position saying there was “nothing wrong with the Executive branch expressing its wish on any measure” proposed to Congress.

At this point, Enrile suggested that senators tackle the matter at length in caucus, to allow the Senate to take up other pending bills, including the required amendments to the Anti-Money Laundering Act to save the Philippines from being blacklisted by global regulator Financial Action Task Force (FATF) which is set to meet this week to update its list of non-compliant countries.

“This is a classic case where the department of government [Finance] that sponsored the sin-tax bill is disowning it and made Senator Recto’s position untenable and I share his umbrage over this,” Angara said. “Let us tell the Executive that if that is the case, nobody will sponsor Executive measures from now on.”

“We better take a stand on this,” Angara said, issuing a warning that “the acts of the DOF and the PLLO endanger relations with Congress.”

Angara added the senators must quickly resolve the issue and “tell the Executive that we won’t stand for this kind of treatment and they ought to know that a committee report is a work in progress.”

In a related development, sin-tax reform advocates and members of civil society said Recto’s watered-down sin-tax bill was imbued with conflict of interest due to presence of a Philip Morris plant in Batangas.

Dr. Maricar Limpin, executive director of the Framework Convention on Tobacco Control Alliance of the Philippines said Batangas is the bailiwick of Recto.

“It is easy to see why Recto would water down the sin-tax bill given that there is a $300-million [P15 billion] plant in Batangas. The least Recto could have done was to inhibit himself from crafting the bill,” Limpin said.

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