Blaming Doesn’t Solve the Problem

Frustrated by their violations of rules and disorderly conduct that led to disturbances, a homeowners association banned mainland Chinese people from leasing residential houses within a posh village in the southern suburbs of Manila. 

Majority of the homeowners cheered the resolution released by the board of governors of the village.  A very few who raised concern about racial profiling were told to shut up or “get some balls.”  Most homeowners hoped that the resolution once and for all would rid the village of undesirable groups of people from mainland China who don’t follow traffic rules, cause unrelenting noise, and get into fights with neighbours. 

But will singling out an ethnicity or a national identity of people really solve the problem?

On one hand, yes. 

The village’s tally of violations showed most, if not all, incidents involved mainland Chinese nationals who were leasing homes as dormitories for online gambling businesses, otherwise known as POGOs (Philippine Offshore Gaming Operators).  Tenants would number by the dozens in one house.  They would throw litter everywhere, make noise throughout the day and night, and disobey traffic rules which led to numerous mishaps and automobile collisions. 

The mainland Chinese tenants continuously ignored the village’s notices to desist their disruptive practices until finally after several years, the village’s board had enough.  The board released the resolution banning people of mainland Chinese citizenship from leasing homes within the village. 

The resolution is logical in the sense that it bans outright most of the violating culprits from the village.  There is no doubt that violations will drop as soon as the offending Chinese residents end their leases and get out. 

But on the other hand, it won’t solve the real problem. 

Getting rid of the mainland Chinese may finally bring back the peace and order the village wants.  It doesn’t, however, answer the question:  why was the village’s authorities unable to enforce rules and regulations in the first place?

Laying blame on an entire race of people (especially from a country that makes up at least a fifth of the global population) is a sweeping solution to the village’s frustrations.  But it doesn’t address how in the first place the village’s association wasn’t able to enforce its rules.  Why couldn’t it? 

When a village, a community, or even a country makes laws, we’d expect that the laws will have provisions for enforcement.  Otherwise, the laws would be useless.  Why make laws that can’t be enforced? 

The village will no doubt dodge criticisms about racism.  Homeowners who cherish their village’s peace and order will be relieved the mainland Chinese culprits would be begone and rid of. 

But when a violation happens again, albeit maybe not as frequently or as seriously, maybe by another defiant resident who is not Chinese, will the village’s authorities be able to enforce their rules? 

Blame is a game politicians and executives have used when they don’t bother to solve a problem.  Adolf Hitler blamed the Jews for Germany’s woes in the 1930’s.  Some Americans in the United States blame minority ethnic groups such as African-Americans, Asians, and Hispanics for high crime rates.  Mainland Chinese officials single out ethnic Uyghurs and Tibetans in drives against cultural differences which are deemed a threat.  There are executives in Manila who blame Indians and Koreans for promoting bad business practices. 

It’s easy to blame other people for problems and we can even claim there’ll be outright improvement when we do so. 

But even if as it may alleviate the effects of a crisis, it does not really solve whatever problem that brought the blame in the first place.  Blame is more a mechanism to deflect problems than it is to solve them. 

We don’t realise that solutions to problems are hard to come by not because there are not many options to choose from but because we didn’t define it right the first time.  We therefore become frustrated and we resort to the blaming, just as what the homeowners’ village did towards mainland Chinese people. 

The homeowners of the village did not really address the root issue:  its inability to enforce the rules effectively

And there are the trade-offs which blame brings.  The posh village now adopts a reputation that it will profile ethnic Chinese people. When a Chinese-looking person enters the village, homeowners will be prejudging his or her appearance against that stereotype of what they experienced as undesirable.  Prejudice on the basis of race will be a norm. It sows the seed of racism that will linger and grow malignantly. 

And that would emerge as a much bigger problem in the future even as the village’s residents probably won’t care for now.

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How to Save Money When Renewing the Dreaded City Business Permit

Every time we enter a new year, many of us reflect on the past and make resolutions for the future. 

When the first working day arrives, however, we face reality. 

One of those realities is the dreaded city business permit renewal. 

Town and city governments in the Philippines require enterprises to register before they can conduct business in their areas of jurisdiction.  Renewing a business permit is mandatory by every third week of January of every calendar year.  It doesn’t matter if the business is big or small, profit or non-profit, every enterprise is required to register and renew their permits annually; there are very few exceptions

The responsibility to register falls mainly on the enterprise.  It’s one more task in an enterprise’s list of things-to-do to comply with the myriad of laws and regulations inherent in doing business in the Philippines. 

The city/town business permit is also known as the mayor’s permit.  To get one, whether new or renewed, the enterprise has to fulfil several prerequisites.  These include:

  • Clearance from a barangay or village;
  • Securing a sanitary permit;
  • Getting an environmental permit;
  • Showing a fire department permit;
  • Clearance from the city’s zoning office;
  • Paying & getting a community tax certificate.

Each prerequisite in turn has its own requirements to meet.  These include:

  • Proof of comprehensive general liability insurance coverage which is insurance to cover for anyone getting injured in an enterprise’s premises;
  • Physical medical examinations of the enterprise’ s employees including x-rays, blood tests, and doctors poking your people’s bodies;
  • A certificate from a licensed pest control exterminator certifying that there are no pests (insects not humans) in the enterprise’s premises;
  • A certificate from a national government agency that you’re complying with environmental laws.  If the enterprise is exempted, it would need to get a certificate that the enterprise is exempted or a certificate that one that does not need a certificate (yes, it’s red tape at its worst);

The enterprise would need to pay fees for each clearance and permit it secures.  The expenses can be hefty.  A community tax certificate can cost up to PhP 10,000 ($USD 200) which is significant for many small businesses.

When an enterprise presents all the clearances and permits to the city/town business permit & licensing office, it will then have to pay the local tax which is based on the enterprise’s sales and spend for fees such as:

  • Garbage fee;
  • Signboard fee (even if you don’t have a signboard);
  • Electrical & mechanical inspection fees;
  • Personnel inspection fees (fees to pay for the medical, police, occupational tax, and seminars of the enterprise’s employees no matter what topics they cover);
  • EPO accreditation fee (EPO is the environmental protection officer of the enterprise and the fee pays for the city’s accreditation or certification of that person);
  • Environmental inspection fee;
  • Sanitary inspection fee;
  • Fire inspection fee – local;
  • Fire inspection fee – national (enterprises pay for the local and national fire departments);
  • Engineering inspection fees.
Sample of a city’s fees other than the tax

These fees seem to cover all the costs of city hall and then some so one wonders where the taxes enterprises pay go to.    

Cities earn a lot of revenue from these business taxes and fees.  Yet, they don’t make it easy for enterprises to renew their permits and pay for them. 

It would take enterprises up to six (6) months if they are getting a business permit for the first time.  And it would come at great cost and time.  Cities and towns would require new businesses to undergo inspections (getting signatures from local agencies, engineers, and other authorities) and submit a lot of paperwork such as tax documents, business registration papers, as-built construction plans, and corporate licenses.  Note that these are requirements for new businesses.  The enterprise is applying for a permit to do business but has to first submit paperwork as if it has already been in operation for years. 

Renewing the business permit every January of every subsequent calendar year isn’t as lengthy but it is a hassle.  Renewing a permit is similar to getting a new one altogether.  One has to submit documents, fill out application forms, and go to one local agency after another to get a city officer to sign the forms saying the enterprise fulfilled its requirements but still is subject to inspection. 

Even if the city puts up what they call a “one-stop-shop” where all the agencies are located in one place, the enterprise’s representative still has to walk and stand in line at each agency’s desk.  The total distance of walking within a “one-stop-shop” can run up to several kilometres, not including the walking after the desk officer tells you that you need to photocopy more of the documents you submitted and you’d have to run outside to the nearest photocopier several hundreds of metres away which also has a line of people waiting. 

There is no value-added benefit in getting a business permit.  At least to the enterprise.  All the value goes to the city.  The enterprise does most of the work preparing & submitting documents and paying for all the taxes and fees for services which mostly one will never really see. 

It’s all part of compliance to laws and regulations that govern enterprises in the Republic of the Philippines.  One has to follow the processes and pay for them for the sake of building the nation and uplifting the lives of citizens (as to which citizens we don’t seem to have any business to know).  As the saying goes, “you can’t fight city hall.”

Enterprise executives delegate much of government compliance work to their employees, such as their bookkeepers, their in-house paralegals, and their administrative staff.  More often than not, compliance is not on an executive’s strategy list.  It is not a competitive priority

If at all, executives rather not spend time thinking about compliance, even so for bothersome local business permits at the start of a new year.  Executives would rather be busy on more so-called important things such as sales, operations, and investments. 

But whether they like it or not, compliance is a priority that executives should not outright ignore.  Because if and when they do, they can pay a high price.

Examples:

  • A city mayor shut down several businesses after inspection showed they were operating without permits;
  • A factory paid a heavy fine after it failed to prove it was complying with local environmental laws (it didn’t have a required bicycle rack and poster that showed the picture of the mayor saying there’s no smoking allowed in the premises);
  • A town billed a trucking company thousands of pesos for delivery vehicles that the latter did not disclose when it renewed its mayor’s permit;
  • A city zoning office refused to give clearance to an enterprise that was operating in a residential area where zoning laws didn’t allow business to be conducted.

We can avoid the unnecessary costs from business permit renewals not only by following procedures but also by looking out for some savings. 

For instance, some cities and towns offer discounts if an enterprise pays one full year’s worth of tax instead of remitting every three (3) months.  An enterprise saves not only from the discount but also from having to send staff to pay every quarter.  (Some cities negate this benefit when their agencies require the enterprises to renew certifications such as environmental & sanitary permits every quarter).

It’s sometimes worth it for an enterprise to examine what it pays for in a business permit.  For example, a commercial building for years has been paying a private company a monthly fee to take away the trash.  The building’s board of trustees realised later that it was paying thousands of pesos in garbage fees to the city.  When the board brought it up to the city sanitation office, the latter instructed the city’s trash hauler to pick up the trash.  The board then cancelled the contract with the private company and stopped spending for something already paid for with the city. 

Enterprise executives always like to enter any new year with confidence and initiative to grow their businesses.  Growth, however, entails meeting obligations such as renewing city permits at the start of every year.  It’s a hassle and it costs a lot but enterprises need to do it else they will pay more in fines or risk being closed down. 

Compliance is a must when it comes to laws and regulations but enterprises can avoid spending too much by examining what they’re charged for and availing of discounts when offered. 

Compliance comes with a cost but we don’t have to spend more than we should.

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