MANILA - LAWMAKERS are targeting a tax on text messages to raise sorely needed revenue for the government - a move that is predictably rankling consumers in the Philippines, the texting capital of the world.

The Short Message Service (SMS) is seen as a potential goldmine for the cash-strapped government because of the vast number of text messages - estimated at two billion a day - sent by Filipinos.

Such heavy reliance on text messaging has generated huge revenues for telecommunications companies, which are protesting against the proposed tax.

A Bill in the House of Representatives is seeking a tax of five centavos (0.15 Singapore cents) on every text message sent by mobile phone. Its backers estimate that the tax would raise between $590 million and $1 billion in revenue for the government.

The measure was passed this month by a key congressional committee, putting it firmly in the legislative pipeline. In the Senate, some lawmakers have said they will not approve the special tax if it hits the pockets of the poor.

The administration of President Gloria Arroyo, which has majority support in the House, is backing the measure as long as consumers do not have to shoulder the tax. Its chances of being passed will improve if Congress can be convinced that will indeed be the case.

Finance Secretary Margarito Teves, quoted in the local media this week, said there was an urgent need for Congress to pass Bills to generate more revenue for the government.

Committee chairman Ezequiel Javier told The Straits Times that the measure contains a 'no pass-on provision' for the telecom firms, and that there is already an ample margin of profit for the industry in the cost of a standard text message.

Not surprisingly, service providers are lobbying hard against the tax. They argue that consumers would be affected because cheap SMS promotions offering, for example, unlimited texting over a given period, will no longer be feasible.

'These bucket-priced SMS plans now serve the basic communication needs of the country's lowest income earners,' said Mr Ray Espinosa, head of regulatory affairs at Philippine Long Distance Telephone Company, whose Smart Communications unit is one of the country's two main cellular services.

Read the full story in Thursday's edition of The Straits Times.

amcindoe@yahoo.com