MAP Insights

It’s been three weeks since I got here in Cambridge, Massachusetts. Never thought I would have to experience heat waves to know how serious climate change (CC) is. It’s not even in the list of courses I want to study at the Harvard Kennedy School (HKS). But the discussion on CC is part of our summer program, and it’s quite intense.

 

It is also part of my ordeal of having to walk daily for 15-20 minutes under the heat of the sun from my apartment to HKS. It’s definitely hotter than the summer in the Philippines. I even got dry cough and colds in the second week. But it’s not COVID-19, that’s CC!

 

The first time I heard about CC was in 2015. The Paris Agreement was all over the news. At that time, it seemed to me that the problem was solved already. I’m not sure how many people around the world did care much about it but I joined our government in celebrating since the Philippines is a signatory of the climate agreement, without clearly understanding what it really meant for me and our country.

 

Unfortunately, the Philippines is a disaster-prone country and more vulnerable to the effects of CC. While we are used to tropical storms and flash floods which usually result in cancellation of classes especially in Metro Manila, we have been experiencing earthquakes, volcanic eruptions, El Niño more often recently, and then COVID-19 pandemic happened.

 

A new department was already proposed prior to the pandemic. It is separate from the National Disaster Risk Reduction and Management Council (NDRRMC), an attached agency under the Department of National Defense, which is currently handling disaster-related concerns. In the opening of the 19th Congress, a proposal for the creation of the Department of Disaster Resilience (DDR) was filed again. In the House Bill No. 13, it was reiterated that seventy-four percent of Filipinos and eighty percent of the country’s land area are exposed to the risk of natural calamities.

 

Consequently, President Ferdinand Marcos, Jr. expressed his support in the creation of the new department during his first State of the Nation Address (SONA) on July 25, 2022. He said that renewable energy is on top of his climate agenda to further lower our carbon footprint. He briefly mentioned about building new nuclear power plants, using more solar power, and providing investment incentives by clarifying the uncertain policies on upstream gas, particularly in the area close to Malampaya gas field – a deepwater gas-condensate reservoir located offshore, 65 km northwest of the island of Palawan.

 

After attending the lectures and discussions on CC as part of the MPA Summer Program at the HKS, I got even more confused and at the same time overwhelmed about how it affects the Philippines or what exactly are we doing back home?

 

So, I became more curious. I started reading and searching all related laws and regulations, policies and programs and anything about CC.

 

I’m not a CC expert but we all have to know and support what our country is doing to save the planet. A strategy roadmap is needed to engage all stakeholders, especially with the use of a balanced scorecard which the public can understand to monitor progress similar to the World Bank Report on Ease of Doing Business.

 

As Co-Chair of the Ease of Doing Business on paying taxes, I have witnessed how all stakeholders, both from public and private sectors, have been very much involved and committed in improving our competitiveness ranking in the World Bank report.

 

The Philippines has committed to a seventy-five percent (75%) Greenhouse Gas (GHG) reduction and avoidance by 2030. With less than one percent of global greenhouse gas emissions, we are definitely not a major source of carbon emissions, unlike China, US and Russia who are the top 3 counties with the largest carbon footprint. But why should we care? And who is on top of all these CC initiatives?

 

The simple answer is we are all in this together. We have one earth to save, regardless of our country’s CO2 emission. We can choose to blame other countries, or resolve to contribute in mitigating the risks and effects of CC.

 

In the Philippines, it’s the CC Commission (CCC) who is the sole policy-making body of the government tasked to coordinate, monitor and evaluate the programs and action plans of the government relating to CC.

 

As a fiscal policy and tax consultant, I have worked with CCC on tax incentives and regulations to build resilience against CC. In the same way, we strive to have an efficient tax system, a climate-resilient Philippines requires a whole government approach involving all stakeholders not just to push for climate agenda but to transition to a more sustainable lifestyle for every Filipino.

 

While we laud CCC’s leadership and accomplishments, we need a balanced scorecard to objectively measure the impact of all existing laws, particularly those granting tax incentives whether they’re really promoting green industries, cities or jobs;  e.g., Renewable Energy Act of 2009 (RA 9513), Green Jobs Act (RA 10771), Philippine Clean Air Act of 1999 (RA 8749), Philippine Clean Water Act of 2004 (RA 9275), among others.

Given the challenges we faced in implementing the existing laws related to CC, CCC must work closely with Congress to make sure mechanisms are in place before new taxes will be imposed. We have to be careful so as not to pass the burden of new taxes to the consumers.

 

CCC will be in the best position to give an impact assessment and recommendations as to what policies or best practices can be adopted to achieve our 75% GHG reduction by 2030. They should also be part of the discussion and deliberation in the Ways and Means Committee regarding the laundry list of proposed taxes, e.g., carbon tax, congestion tax, energy tax, air pollution tax, biodiversity services tax, single-use plastic tax or even a border carbon adjustment so we can impose carbon tariffs on carbon intensive products.

 

In the end, we are one with the CCC in its vision of a climate-resilient and climate-smart Philippines with healthy, safe, prosperous and self-reliant communities, and more environment-friendly, earth-loving and responsible Filipinos.

 

(This article reflects the personal opinion of the author and does not reflect the official stand of the Management Association of the Philippines or MAP.  The author is Member of the MAP Ease of Doing Business Committee, Founding Chair and Senior Tax Advisor of Asian Consulting Group and Co-Chair of Paying Taxes – EODB Task Force. He is Trustee of CSR Philippines – the advocacy partner of the BIR, Department of Trade and Industry (DTI), and Anti-Red Tape Authority (ARTA) on ease of doing business and tax reform. Feedback via map@map.org.ph and mon@acg.ph).