Your taxes must build schools and hospitals, not bankroll luxury bags and mansions
“The power to tax is the power to destroy.” In history, it was also the power to destroy corruption. The downfall of Al Capone, one of America’s most infamous gangsters, is the clearest example. Despite evidence of murders and racketeering, what finally put him in prison was tax evasion. In 1931, Al Capone was convicted for failing to pay taxes on his lavish, illegal income and sentenced to 11 years in prison. His case proved one thing: when all else fails, follow the money.
This principle has been applied globally. In Italy, mafia bosses were brought down through tax audits and asset seizures. In Brazil, “Operation Car Wash” exposed a web of corruption worth over $5 billion, leading to hundreds of convictions. In South Korea, two former presidents were jailed for corruption and tax-related crimes tied to family conglomerates. Around the world, tax enforcement has proven to be the sharpest tool against corruption.
The Philippine reality
In the Philippines, corruption drains ₱700 billion to ₱1.3 trillion annually (equivalent to 20% of the national budget, based on assessments cited by multilateral institutions such as the World Bank, the International Monetary Fund (IMF), and the Asian Development Bank (ADB). From ghost projects and padded contracts to the misuse of confidential funds, taxpayers’ money is diverted to the private luxuries of the powerful. Political dynasties and their favored contractors thrive through joint ventures and undue influence, enriching themselves while ordinary Filipinos struggle.
Meanwhile, social media flaunts their ill-gotten wealth — luxury cars, designer bags, million-peso lifestyles — far beyond what their declared incomes can justify. This is not just immoral. Under Philippine law, it is tax evasion, punishable by imprisonment, fines, and perpetual disqualification from public office.
Transparency International’s 2024 Corruption Perceptions Index (CPI) ranks the Philippines 114th out of 180 countries, behind peers in ASEAN like Malaysia (57th) and Vietnam (88th). Weak enforcement not only embarrasses the country globally, but it also undermines democracy at home.
Corruption is failure in governance
Corruption is more than theft — it is a failure in governance. It undermines the law, weakens democratic institutions, and erodes the moral foundation of society.
If taxpayers see the corrupt escape accountability, voluntary compliance collapses. If foreign investors perceive dynasties enriching themselves through public funds, confidence erodes. Corruption acts like a hidden tax on investment, discouraging FDI and weakening economic growth. The consequence is clear: less revenue for the state, fewer jobs for the people, and weaker resilience for the future.
Accountability is non-negotiable
To restore trust, the Bureau of Internal Revenue, the Commission on Elections, and the Office of the Ombudsman must:
1. Audit confidential funds and discretionary allocations.
2. Investigate joint ventures and contractors linked to political dynasties.
3. Scrutinize campaign donors who benefit from government contracts.
4. Prosecute relentlessly — not only contractors, but politicians and families who profit from corruption.
5. Enforce perpetual disqualification for convicted officials to end dynastic abuse.
This is not just about punishing crimes. It is about spending taxes judiciously — not for the lavish lifestyles of the few, but for the urgent needs of the many:
Reimagining the World Without Corruption
In my book, Reimagining the World Without Corruption, launched at Harvard Kennedy School, I argue that corruption is not only a political failure but an economic trap. It erodes public trust, deters investments, and worsens inequality. To break free, we must ensure that every peso collected serves the people — not political dynasties.
The global message is clear: Countries that hold the powerful accountable attract more investment and build stronger democracies. For the Philippines, the path forward is equally clear: follow the money, prosecute the guilty, and rebuild trust in governance.
Your taxes must build schools and hospitals, not bankroll luxury bags and mansions.
No one is above the law. – Rappler.com
Raymond “Mon” Abrea is the founder and chief tax advisor of the Asian Consulting Group (ACG). Known as the “Philippine Tax Whiz,” he is a Harvard-educated public policy expert, Oxford-trained in Climate Policy, and Duke-certified in Tax Policy. He is the author of the “Reimagining the World Without Corruption,” which he launched at Harvard, and has served as a tax expert resource in both the Senate and the House of Representatives, including during the Pharmally investigation.