Rep. Kiko Barzaga Files Bill to Abolish VAT, Sparks National Debate on Tax Reform
A sweeping proposal to eliminate the country’s Value-Added Tax (VAT) system was formally submitted to the House of Representatives today by Cavite Representative Kiko Barzaga. Dubbed the “VAT Abolition Bill,” the measure seeks to repeal the 12% VAT currently levied on goods and services nationwide, citing its disproportionate impact on low-income Filipinos.
Barzaga emphasized that VAT has become a regressive tax that burdens ordinary citizens more than the wealthy. “This is not just about removing a tax—it’s about restoring fairness,” he said in his sponsorship speech. The bill proposes a shift toward more progressive taxation, including strengthened income and corporate tax mechanisms to offset potential revenue losses.
The Department of Finance has yet to issue an official statement, but early reactions from economists and policy analysts suggest caution. VAT contributes hundreds of billions of pesos annually to the national budget, funding essential services such as education, healthcare, and infrastructure. Critics warn that abolishing it without a robust replacement could lead to fiscal instability.
Consumer advocacy groups, however, welcomed the move. “VAT hits the poor hardest. Removing it is a step toward economic justice,” said Marissa Cruz, spokesperson for Bayan Konsumer. Social media also lit up with mixed reactions, with hashtags like #ByeByeVAT and #TaxJustice trending throughout the day.
The bill will undergo committee deliberations in the coming weeks, where lawmakers are expected to scrutinize its fiscal viability and long-term impact. Barzaga has called on his colleagues to “legislate with empathy and courage,” urging them to consider the lived realities of Filipino families.
If passed, the VAT Abolition Bill could mark one of the most significant tax reforms in Philippine history, reshaping how the government collects revenue.
