According to most estimates, some 85% of the entire Philippine national budget now goes to debt payments – principal and interest. This is often cited as the reason more taxes, such as the VAT, the E-VAT, and now the R-VAT, have to be collected.
Consider the significance of this fact: it means that 85% of any income the government collects goes to banks, mainly to international financial institutions who are our biggest lenders. Of what remains, around half is further dissipated through corruption, going into the private pockets of politicians and bureaucrats. The little that is actually spent for social services, furthermore, may go to projects of questionable benefit to the people.
This means that every time government bureaucrats invoke the need to provide basic social services as the main reason for raising taxes, they are lying. The main reason is to pay off government creditors. Most of the tax collections will go to them, automatically appropriated.
In the 18th century, Filipinos were forced to pay the Spanish king, in one year, in cash and kind, tributes totalling around 250,000 for the entire Philippines. Of this, 187,229 pesos (74.9%) went to the local Catholic hierarchy, 59,303 pesos (23.7%) went to the local bureaucracy, and 3,467 pesos (1.4%) went to the royal treasury. Even assuming that all the Church’s share went to Spain or Rome, that plus the share of the royal treasury would still be a lower percentage of the total than the 85% that the government today hands over to our creditors.
In effect, we are in a financially worse situation today than during the Spanish era. The Spanish king has been replaced by the banks and other international lending institutions. The governor-general has been replaced by a president as their principal tax collector.
We are more exploited today than anytime in the past. The colonial period has returned, with a vengeance.
(Source: Francisco Leandro de Viana, Royal Fiscal, “Financial Affairs of the Philippine Islands”, 10 July 1766, from Zaide’s Documentary Sources of Philippine History, Vol. 6, p. 98).