Senators and congress­men in the Philippines have denounced the World Bank for trying to impose its will on the nation’s Congress.

Lawmakers on Wednesday denounced as blackmail the World Bank’s warning that the country’s international donors would increase their assistance to the Philippines only if the government speeds up the passage of fiscal reform measures, including the va­lue-ad­ded tax bill.

Senators and congress­men alike assailed the World Bank for trying to impose its will on Congress.

Senators Juan Ponce En­rile and Edgardo Angara were one in saying that the World Bank cannot dictate to lawmakers to approve the bill that would raise the VAT from 10 percent to 12 percent.

“They cannot tell us how we will pass the law. We will pass the law according to our judgment of what it should be,” Enrile said.

He said the World Bank should know that Congress must craft and pass the kind of VAT bill it thinks acceptable and fair to Filipinos.

Angara thinks it was very presumptuous of the World Bank to dictate to the country how it should run its affairs.

“It can suggest to us the bill we will have to take but not the details of how we would craft the VAT bill,” Angara said.

Senate President Franklin Drilon brushed aside the World Bank’s warning, saying it is “just a reminder that Congress has to pass fiscal and tax reforms that would generate P80 billion in revenues” for the cash-strapped government.

Last year Congress passed the sin tax bill that would net P15 billion in revenues.

But Drilon stressed that the Senate would pass a VAT bill based on what it views as the national interest and not on the basis of the World Bank’s prescription.

Congressmen were equally incensed.

Exequiel Javier of Antique and Marcelino Libanan of Eastern Samar in a joint statement advised the foreign lending institutions to stop dictating to Congress what to do because even without their instructions, the Arroyo administration is doing everything it can to fulfill its economic reform agenda.

Javier said the grants being extended by the World Bank to the Philippines do not give it the license to dictate to the country, especially if it involves an “additional burden to the people.”

“There is no need to pressure us on the VAT bill, since we have prioritized it pursuant to the urgent fiscal agenda of President Arroyo,” Javier, vice chair of the House Committee on Justice, said. “The World Bank cannot tell us to immediately pass the VAT bill. We have to abide by the rules and follow the procedure.”

Libanan said the warning of the World Bank shows its outmost neglect for the plight of the people.

“The World Bank should not blackmail the government, which has been espousing self-reliance through generation and saving to raise money for the government to carry out its development agenda,” Libanan said.

Party-list Rep. Teodoro Casiño of Bayan Muna said the World Bank still had the temerity to blackmail the country when 85 percent of government revenues already go to debt servicing.

“If they really want to help, how about condoning our debts?” Casiño said.

Rep. Rozzano Rufino Biazon of Muntinlupa believes the World Bank will still extend loans to the country even without the VAT bill. “It will just give smaller loans with higher rates. Its threat should not matter to us. What we should think about is higher revenue, lower deficit,” Biazon said.

Malacañang denied reports the government is under pressure from the multilateral donors to pass the fiscal reform bill.

Press Secretary Ignacio Bunye said the World Bank should leave it up to Congress to determine what VAT version to approve.

Malacañang appeared disappointed by the Senate’s rejection of the Palace-backed proposal for an additional 2-percent VAT.

The Senate Committee on Ways and Means of Sen. Ralph Recto supported the retention of the 10-percent VAT but lifted the exemptions on some goods and services.

Bunye said the legislative and the executive are working together to help generate more funds to deal with the country’s chronic debt problem.

Patricia Esteves, Maricel V. Cruz and Ma. Theresa Torres, Manila Times, March 10, 2005