Budget and Taxes

*  BusinessWorld , March 13, 2023. ------------- In East Asia, only the Philippines and Japan sustained high inflation until January-February this year. Indonesia, Singapore, and Vietnam have generally trended flat while Thailand, Malaysia, China, South Korea, and Taiwan have declining trends. This suggests that internal or domestic factors affect our commodities market more than external factors. The main contributors of high inflation in the Philippines, from the fourth quarter 2022 until February 2023 are transport, electricity and fuels, food, and alcohol-tobacco. (See Table 1.) So, despite the series of interest rate hikes by the Bangko Sentral ng Pilipinas from only 2% in May 2022 to 5.5% last December, this demand restriction scheme did not work as expected because the commodities that experience high inflation until today are basic necessities like food and electricity. The non-monetary measures needed both in short- and long-term would include: 1.) more food production pre...

*  BusinessWorld  March 6, 2023. --------------- The Philippines’ inflation rate of 8.1% last December, then 8.7% last January, was high but it is not unique to us — the country just joined Singapore, Thailand, and Taiwan in hitting a 14-year high in its inflation rate. Japan, the US, and the UK have hit 41-year highs while Germany has had its highest inflation rate in 70 years. Contrary to the dishonest narrative that global inflation started rising only when Russia invaded Ukraine on Feb. 24, 2022, the start of the increase in inflation coincided with US President Joe Biden’s succeeding Donald Trump. US inflation was only 1.4% in January 2021, which was Trump’s last month in office, jumping to 7.5% in January 2022 or 12 months under the Biden administration and one month before the Russia-Ukraine war. (See Table 1). Last week, the Cabinet economic team gave a briefing at the House Committee on Appropriation about government policies to control inflation. Finance Secretary Be...

*  BusinessWorld  February 27, 2023.  ----------- Feb. 24 last week marked the first anniversary of Russia’s invasion of Ukraine. The Ukraine crisis has morphed from a border war between the two countries to a potential nuclear conflict in Europe. Here are five major crisis narratives which have had a big impact on economic growth and individual freedom.... 2. The economic/poverty crisis.  Government-imposed lockdowns then overspending and borrowing for aid/ayuda and subsidies will lead to more taxes in the future to pay for the huge borrowing. Below I make two computations: a.) required growth in 2021 to reach the level of 2019’s gross domestic product (GDP), and, b.) required growth in 2023 to expand by 15% over 2019’s GDP level. The results show that for many East Asian economies, their GDP growth in 2021 has enabled them to recover a similar GDP size of 2019. For the Philippines, a.) GDP growth in 2021 should have been 10% and not just 5.7% to be at the same GDP ...