Hanieyah Guro

BSN-2B

LAND REFORM IN THE PHILIPPINES

The dilemma of the Friar Land Issue faced up to the US government subsequent to the conquest
of the Philippines from Spain in 1998, relating to the nature of huge landed states owned by Spanish
monastic orders on the islands. For more than 300 years, the Roman Catholic Church had been
intimately involved with Spanish colonial government in the Philippines. During the time, three religious
orders – Dominicans, Augustinians, and Recollects – had acquired about one-tenth of all the improved
lands in the islands. The discontent Filipino peasants with this situation had been a contributing factor in
the Philippine Revolution in 1896-98.

In the Treaty of Paris (1898), which settled the Spanish-American War, the US government
agreed to protect the friars’ property rights, but it was clearly dangerous to allow them to return to their
lands. An agreement was eventually reached under which the US purchased 410,000 acres (about
170,000 hectares) for a sum of $7,000,000. The land was then resold to the tenant farmers on an
installment basis. This solution was not entirely satisfactory; numerous disputes arose over the accuracy
of surveys and terms of repayment. Continued monastic possession of certain parcels of land has been a
source of contention ever since, as has the issue of land reform in general.

The Sakdalista Uprising was a brief rebellion in the agricultural area of Central Luzon, on the
night of May 2-3, 1935. Though quickly crushed, the revolt of the Sakdals or Sakdalistas warned off
Filipino peasants’ frustrations with the oppressive land tenancy situation. The Sakdal movement was
founded in 1930 by Benigno Ramos, a discontented former government clerk. Drawing strength from
illiterate, landless peasants, the movement advocated a drastic reduction of taxes on the poor and
radical land reform, including a breakup of large estates. It also opposed the policy of the dominant
Nationalista Party of accepting gradual independence from the United States, demanding instead
immediate severance of all Philippines-American ties.

During the early 1930s the Sakdals seemed to draw inspiration from the Gandhi’s non-
cooperation movement in India and urged non-participation in government: boycott of elections, and
withholding of taxes. In1933 the Sakdals organized as a political party. They did surprisingly well in the
Philippines election in 1934 and were thus encouraged to attempt an uprising the following year. On the
night of May 2, partially armed mobs seized municipal buildings in 14 towns. The uprising was crushed
the next day, with the loss of about 100 lives. Ramos fled to Tokyo and the Sakdals were disbanded., but
rural conditions remained a source of frustrations and dissensions and led to numerous other such
peasant rebellions.

The Huk Rebellion (1946-54), categorized as a Communist – led peasant uprising in Central
Luzon. The name of the movement is a Tagalog acronym for Hukbo ng Bayan Laban sa Hapon (People’s
Anti-Japanese Army). The Huks became close to victory in 1950 but were subsequently defeated by a
combination of advanced US weaponry under the charismatic Philippine president Ramon Magsaysay.

The Central Luzon plain is a rich agricultural area where a large peasant population worked as
tenant farmers on vast estates. The visible contrast between the wealthy few and the poverty-stricken
masses was responsible for periodic peasant revolts during the Spanish period of Philippine history.
During the 1930s Central Luzon became a focus for Communist and Socialist organizational activities.
World War II brought matters to a head. Unlike many other Southeast Asians, the Filipinos offered
strong resistance against the Japanese. After the fall of the Bataan to the Japanese (April 1942),
organized guerilla bands carried on the fight for the remainder of the occupation period. The
Hukbalahap organization proved highly successful as a guerilla group and killed many Japanese troops.
The Huks regarded wealthy Filipinos who collaborated with the Japanese as targets for assassination,
and by the end the war they had seized most of the large estates in Central Luzon. They established a
regional government, collected taxes, and administered their own laws.

The Philippines introduced a reform program in 1963, under the President Diosdado Macapagal
which aimed primarily at replacing share tenancy with the lease contracts and eventually with
ownership, and at revitalizing agriculture through extension services. By the mid-1980s the program had
given titles to about 400,000 tenants and secure leases to another 600,000, but the economic viability of
the new units has been uncertain because of their small scale and the lack of supplementary facilities.
The main effects initially were seed improvement, greater use of fertilizers, and an increase in
contractual tenancy. To cambat the negative effects of small-scale farming, the Philippine government
has resorted to what it calls the compact farm, which is voluntary grouping of small farms to be
operated under one management as one consolidated farm. The problem of surplus labor, especially
migrant seasonal laborers or sacadas however, remains to be solved.

THE AGRARIAN REFORM

The mandate of the Department of Agrarian Reform and its former incarnations has always
been questionable, due to its inability to rid poverty in the countryside, and the massive amounts of
taxpayers' money needed to finance its operations and personnel. Moreover, it has been perceived by
some as a political tool for those who seek votes from the masses. To complicate matters, those who
end up elected and thus have a greater influence on public policy happen to be well-meaning
proponents of this method of land reform, whose ability to eradicate the inequalities in land ownership
comes to no surprise to critics of the land reform system.

Land reform in the Philippines had its beginnings in 1963, when Section 49 of Republic Act (RA)
3844, or the Agricultural Land Reform Code, necessitated the creation of the Land Authority. This agency
was tasked to implement the policies set forth in RA 3844 and was created on August 8, 1963. Republic
Act 3844 reorganized existing agencies involved in tasks related to land reform and realigned their
functions towards attaining the common objectives of the land reform program.

On September 10, 1971, President Ferdinand E. Marcos signed RA 6389, otherwise known as the
Code of Agrarian Reform of the Philippines, into law. Section 49 of this act mandated the establishment
of a new self-contained department, the Department of Agrarian Reform, and this effectively replaced
the Land Authority. In 1978, under the parliamentary form of government, the DAR was renamed the
Ministry of Agrarian Reform. On July 26, 1987, the department was organized something structurally
and functionally through Executive Order (EO) No. 129-A.

In 1988, Republic Act No. 6657, otherwise known as the Comprehensive Agrarian Reform Law
(CARL) was signed into law and became the legal basis for the implementation of the Comprehensive
Agrarian Reform Program (CARP). It is an act instituting a CARP with the aim of promoting social justice
and industrialization. RA 6657 also provided the mechanism for its implementation. It was signed by
President Corazon C. Aquino on June 10.

On September 27, 2004, President Gloria Macapagal-Arroyo, signed by me Executive Order No.
364, and the Department of Agrarian Reform was renamed to Department of Land Reform. This EO also
broadened the scope of the department, making it responsible for all land reform in the country. It also
placed the Philippine Commission on Urban Poor (PCUP) under its supervision and control. Recognition
of the ownership of ancestral domain by indigenous peoples also became the responsibility of this new
department, under the National Commission on Indigenous Peoples (NCIP).

On August 23, 2005, President Gloria Macapagal Arroyo signed Executive Order No. 456 and
renamed the Department of Land Reform back to Department of Agrarian Reform, since "the
Comprehensive Agrarian Reform Law goes beyond just land reform but includes the totality of all factors
and support services designed to lift the economic status of the beneficiaries."

CODE OF AGRARIAN REFORMS (R.A. No. 3844, as amended)

Recipients under the code

 Tenant farmers – under the code, share tenancy is involuntarily transformed to leasehold and
landless farmers are prearranged to an opportunity to possess the lands they cultivate.
 Agricultural wage-earners or farm workers – agreed, in all-purpose, all the constitutional rights
and chances at the moment enjoyed by business workers.
  Settlers including migrant workers – the unproductive and disorganized defrayal scheme which
prohibited those who stirred from extremely tenanted areas from captivating up prolific lives in
community undeveloped lands.
 Owners-cultivators of less than family-size farms – the lack of credit, irrigation, promotion and
information facilities among them, motivated their lack of association.

TENANT EMANCIPATION DECREE (Presidential Decree No. 27)

Under the Code of Agrarian Reforms (R.A. No. 3844, as revised by R.A. No. 6389), the adaptation
of tenant to complete possessor engages three reallocates, to wit;

 Share tenant to leaseholder

 Leaseholder to amortizing owner
 Amortizing owner to full owner

RIGHTS AND OBLIGATIONS OF THE LESEES AND LESSORS

Lessees Rights

 Custody and serene pleasure of the land

 Administration to toil on the land
 Automation of his farm effort
 Transaction with millers and processors and be present at distribution of quedans and
storehouse total admission money for the manufacture payable him.
 Control of home lot or carry on in the satisfaction of any house lot.
 Reimbursement for costs and everyday expenditure sustained and a ½ of helpful expansions on
the landholding.
 Other rights of pre-emption and redemption.

Lessees Obligations

 Outstanding concern of farm

 Become aware of intrude
 Care of leasing facilities
 Correct awareness to farm
 Take in of harvest
 Imbursement of rental

Lessors Rights

 Check Up
 Propose transform
 Confirm farm performs
 Mortgage the land
 Other rights and take delivery of compensation of rental

Lessors Commitment

 Maintain the lessee in serene custody and farming of his landholding

 Continue the enduring functional enhancements accessible on the landholding such as irrigation
and drainage scheme.

TAXATION

Taxation is based on the reciprocal duties of protection and support between the State and its
citizens as well as residents, and on the sovereign power as well as jurisdiction by the State over its
people and property. The taxpayers are presumed to have received benefits and protection to life,
liberty and property from the government for which they have to reciprocate by paying taxes for its
support. As long as the tax is for the public purpose, t is not necessary that a particular tax payer stands
to be benefitted by the tax imposed.

Functions or Purpose of Taxation

1. To raise revenue – following the so-called “Lifeblood doctrine”, taxes are the lifeblood of the
government, without which it cannot operate.
2. To impose regulation and control – taxation can be used as an implement of police power to
protect local industries and/or to reduce inequalities of wealth and income.

KINDS OF TAXES

A. Ad Valorem

An ad valorem tax is one where the tax base is the value of a good, service, or property. Sales
taxes, tariffs, property taxes, inheritance taxes, and value added taxes are different types of ad valorem
tax. An ad valorem tax is typically imposed at the time of a transaction (sales tax or value added tax
(VAT)) but it may be imposed on an annual basis (property tax) or in connection with another significant
event (inheritance tax or tariffs). An alternative to ad valorem taxation is an excise tax, where the tax
base is the quantity of something, regardless of its price. For example, in the United Kingdom, a tax is
collected on the sale of alcoholic drinks that is calculated by volume and beverage type, rather than the
price of the drink.

B. Bank Tax

A bank tax ("bank levy") is a proposed tax on banks. One of the earliest modern uses of the term
"bank tax" occurred in the context of the Financial crisis of 2007–2010.

C. Capital Gains Tax

A capital gains tax is the tax levied on the profit released upon the sale of a capital asset. In
many cases, the amount of a capital gain is treated as income and subject to the marginal rate of income
tax.

D. Consumption Tax

A consumption tax is a tax on non-investment spending, and can be implemented by means of a sales
tax or by modifying an income tax to allow for unlimited deductions for investment or savings.

E. Corporate Tax

Corporate tax refers to a direct tax levied by various jurisdictions on the profits made by
companies or associations and often includes capital gains of a company. Earnings are generally
considered gross revenue less expenses. Corporate expenses that relate to capital expenditures are
usually deducted in full (for example, trucks are fully deductible in the Canadian tax system, while a
corporate sports car is only partly deductible). They are often deducted over the useful life of the asset
purchase. Notably, accounting rules about deductible expenses and tax rules about deductible expense
will differ at times, giving rise to book-tax differences. If the book-tax difference is carried over more
than a year, it is referred to as a temporary difference, which then creates deferred tax assets and
liabilities for the corporation, which are carried on the balance sheet.

F. Currency Transaction Tax

A currency transaction tax is a tax placed on a specific type of currency transaction for a specific
purpose. This term has been most commonly associated with the financial sector, as opposed to
consumption taxes paid by consumers. There are several types of currency transaction taxes that have
been proposed, the most prominent being the Tobin tax and the Spahn tax. Most remain
unimplemented concepts.
G. Environment Affecting Tax

This includes natural resources consumption tax, GreenHouse gas tax (Carbon tax), "sulfuric
tax", and others. The stated purpose is to reduce the environmental impact by repricing.

H. Excise Tax

Unlike an ad valorem, an excise is not a function of the value of the product being taxed. Excise taxes are
based on the quantity, not the value, of product purchased

I. Expatriation Tax

An Expatriation Tax is a tax on some who renounce their citizenship of some governments. The
most significant Expatriation Tax is one found in the USA.

J. Financial Activities Tax

A financial transaction tax is a tax placed on a specific type (or types) of financial transaction for a
specific purpose (or purposes). This term has been most commonly associated with the financial sector,
as opposed to consumption taxes paid by consumers.

K. Income Tax

An income tax is a tax levied on the financial income of persons, corporations, or other legal
entities. Various income tax systems exist, with varying degrees of tax incidence. Income taxation can be
progressive, proportional, or regressive. When the tax is levied on the income of companies, it is often
called a corporate tax, corporate income tax, or corporation tax. Individual income taxes often tax the
total income of the individual (with some deductions permitted), while corporate income taxes often tax
net income (the difference between gross receipts, expenses, and additional write-offs).

L. Inflation Tax

An inflation tax is the economic disadvantage suffered by holders of cash and cash equivalents in
one denomination of currency due to the effects of Expansionary monetary policy, which acts as a
hidden tax that subtracts value from those assets. Many economists hold that the inflation tax affects
the lower and middle classes more than the rich, as they hold a larger fraction of their income in cash,
they are much less likely to receive the newly created monies before the market has adjusted with
inflated prices, and more often have fixed incomes, wages or pensions. Some argue that inflation is a
regressive consumption tax.

M. Inheritance Tax

Inheritance tax, estate tax, and death tax or duty are the names given to various taxes which
arise on the death of an individual. In United States tax law, there is a distinction between an estate tax
and an inheritance tax: the former taxes the personal representatives of the deceased, while the latter
taxes the beneficiaries of the estate. However, this distinction does not apply in other jurisdictions; for
example, if using this terminology UK inheritance tax would be an estate tax.

N. Poll Tax

A poll tax, also called a per capita tax, or capitation tax, is a tax that levies a set amount per
individual. It is an example of the concept of fixed tax. One of the earliest taxes mentioned in the Bible
of a half-shekel per annum from each adult Jew (Ex. 30:11-16) was a form of poll tax. Poll taxes are
administratively cheap because they are easy to compute and collect and difficult to cheat. Economists
have considered poll taxes economically efficient because people are presumed to be in fixed supply.
O. Property Tax

A property tax is a tax put on property by reason of its ownership. Property tax can be defined
as "generally, tax imposed by municipalities upon owners of property within their jurisdiction based on
the value of such property." There are three species of property: land, improvements to land
(immovable man-made things, e.g. buildings) and personal property (movable things). Real estate or
realty is the combination of land and improvements to land.

Property taxes are usually charged on a recurrent basis (e.g., yearly). A common type of
property tax is an annual charge on the ownership of real estate, where the tax base is the estimated
value of the property. For a period of over 150 years from 1695 a window tax was levied in England,
with the result that one can still see listed buildings with windows bricked up in order to save their
owners money. A similar tax on hearths existed in France and elsewhere, with similar results. The two
most common types of event driven property taxes are stamp duty, charged upon change of ownership,
and inheritance tax, which is imposed in many countries on the estates of the deceased.

P. Social Security Tax

Some countries with social security systems, which provide income to retired workers, fund
those systems with specific dedicated taxes. These often differ from comprehensive income taxes in that
they are levied only on specific sources of income, generally wages and salary (in which case they are
called payroll taxes). A further difference is that the total amount of the taxes paid by or on behalf of a
worker is typically considered in the calculation of the retirement benefits to which that worker is
entitled.

Q. Sales Tax

Sales taxes are levied when a commodity is sold to its final consumer. Retail organizations
contend that such taxes discourage retail sales. The question of whether they are generally progressive
or regressive is a subject of much current debate. People with higher incomes spend a lower proportion
of them, so a flat-rate sales tax will tend to be regressive. It is therefore common to exempt food,
utilities and other necessities from sales taxes, since poor people spend a higher proportion of their
incomes on these commodities, so such exemptions would make the tax more progressive. This is the
classic "You pay for what you spend" tax, as only those who spend money on non-exempt (i.e. luxury)
items pay the tax.

R. Tariff

An import or export tariff (also called customs duty or impost) is a charge for the movement of
goods through a political border. Tariffs discourage trade, and they may be used by governments to
protect domestic industries. A proportion of tariff revenues is often hypothecated to pay government to
maintain a navy or border police. The classic ways of cheating a tariff are smuggling or declaring a false
value of goods. Tax, tariff and trade rules in modern times are usually set together because of their
common impact on industrial policy, investment policy, and agricultural policy. A trade bloc is a group of
allied countries agreeing to minimize or eliminate tariffs against trade with each other, and possibly to
impose protective tariffs on imports from outside the bloc. A customs union has a common external
tariff, and, according to an agreed formula, the participating countries share the revenues from tariffs on
goods entering the customs union.

S. Toll

A toll is a tax or fee charged to travel via a road, bridge, tunnel, canal, waterway or other
transportation facilities. Historically tolls have been used to pay for public bridge, road and tunnel
projects. They have also been used in privately constructed transport links. The toll is likely to be a fixed
charge, possibly graduated for vehicle type, or for distance on long routes.

T. Transfer tax
 Historically, in many countries, a contract needed to have a stamp affixed to make it valid. The
charge for the stamp was either a fixed amount or a percentage of the value of the transaction. In most
countries the stamp has been abolished but stamp duty remains. Stamp duty is levied in the UK on the
purchase of shares and securities, the issue of bearer instruments, and certain partnership transactions.
Its modern derivatives, stamp duty reserve tax and stamp duty land tax, are respectively charged on
transactions involving securities and land. Stamp duty has the effect of discouraging speculative
purchases of assets by decreasing liquidity. In the United States transfer tax is often charged by the state
or local government and (in the case of real property transfers) can be tied to the recording of the deed
or other transfer documents.

U. Value Added Tax

A value added tax (VAT), also known as 'Goods and Services Tax' (G.S.T), Single Business Tax, or
Turnover Tax in some countries, applies the equivalent of a sales tax to every operation that creates
value. To give an example, sheet steel is imported by a machine manufacturer. That manufacturer will
pay the VAT on the purchase price, remitting that amount to the government. The manufacturer will
then transform the steel into a machine, selling the machine for a higher price to a wholesale
distributor. The manufacturer will collect the VAT on the higher price, but will remit to the government
only the excess related to the "value added" (the price over the cost of the sheet steel). The wholesale
distributor will then continue the process, charging the retail distributor the VAT on the entire price to
the retailer, but remitting only the amount related to the distribution mark-up to the government. The
last VAT amount is paid by the eventual retail customer who cannot recover any of the previously paid
VAT. For a VAT and sales tax of identical rates, the total tax paid is the same, but it is paid at differing
points in the process.

V. Wealth Tax

Some countries' governments will require declaration of the tax payers' balance sheet (assets
and liabilities), and from that exact a tax on net worth (assets minus liabilities), as a percentage of the
net worth, or a percentage of the net worth exceeding a certain level. The tax is in place for both
"natural" and in some cases legal "persons".

POWER OF TAXATION

Taxation is the power of the State to demand from the people their proportionate share on
contribution in the maintenance of the Government.

The reason behind this is that the obligation to pay taxes is not based on contract. It is a duty
imposed upon individual by the mere fact of his membership in the body politic and his enjoyment of
the benefits available from such membership.

The more concise definition of taxation is that it is the act levying a tax, the process or means by
which the sovereign, through its law-making body, raises revenue to defray government expenses.