Jess
Diaz (The Philippine Star) - October 11, 2018 - 12:00am
MANILA, Philippines —
New and higher taxes on diesel and other oil products will most likely be
suspended in January next year, Albay Rep. Joey Salceda said yesterday.
Under the controversial
Tax Reform for Acceleration and Inclusion (TRAIN) law, Salceda said that taxes
for next year would be suspended if the price of world crude averages at least
$80 per barrel for three months.
He said based on
contracted deliveries for this month, November and December, crude would remain
above $80 per barrel.
“That means that the
increase in taxes for 2019 will be automatically suspended,” he said in an
interview.
President Duterte had
earlier voiced his openness to calls for the suspension of excise tax on oil to
arrest the runaway inflation.
But Finance Assistant
Secretary Tony Lambino said they want some guidance on the pronouncement of the
President as he might be referring to the next tranche of increase in the
excise taxes on oil.
“As far as I could
tell, I interpreted the statement as being the next increase which is P2, the
2019 increase in the excise. And actually, there already is suspension
mechanism in place in the TRAIN law for that to happen,” Lambino said at a
press briefing yesterday in Malacañang.
Energy Secretary
Alfonso Cusi, for his part, said they are “preparing a formal memo to the
Office of the President to seek the suspension of the collection of excise
taxes on petroleum products.”
In a statement, the
Department of Energy said “current global situation” is largely to blame for
surging fuel prices. It also said that “global oil prices also tend to go up in
the winter months (October-March), as demand for heating is at its highest.”
The TRAIN law imposed a
new tax of P7 per liter or kilogram on diesel, cooking gas, kerosene and bunker
oil for electricity generation, and higher taxes on other petroleum products
like gasoline. The levies were to be spread over three years starting this
year. Next year’s adjustment will range from P1 to P2.
Lambino stressed
legislative action is needed to implement an immediate suspension of excise
taxes.
“The excise tax rates
are provided in the law. So if we suspend based on the mechanism that is in the
TRAIN Law, then that can be automatic. But if we do something else, it would
require different actions,” the finance official said.
Lambino said inflation,
which hit a record-high 6.7 percent in September, would remain high even if the
excise taxes are suspended.
“I think we also need
to manage the expectations in the sense that if Congress decides to create a
new suspension mechanism, the prices of oil would not go down that much because
the import price has risen from about $40 per barrel to above $80 per barrel.
The import price is something unfortunately we do not control because we are
not an oil producer. We are a price-taker,” Lambino said.
TRAIN not the only answer
He claimed that without
the TRAIN law, inflation would still be at six percent to 6.3 percent instead
of 6.7 percent. He said the excises taxes on fuel only constitute 25 percent of
the increase in fuel prices.
“The 75 percent will be
there whether there is TRAIN or not. The inflation will remain high,” he said.
“If you look at the
food versus non-food analysis, food is accelerating while non-food is
decelerating in terms of the inflation rate. So that’s why the economic
development cluster prioritized immediate actions to bring down the prices of
food by increasing supply,” he said.
Lambino said the
government would not be able to collect P40 billion in 2019 if the next tranche
of increase in fuel excise taxes is suspended.
Starting January 2019,
the TRAIN law will impose higher excise tax on gasoline from P4.35 per liter to
P7 per liter, P2.50 per liter for diesel, P3 per liter for kerosene and P1 per
kilogram on liquefied petroleum gas (LPG).
In 2020, tax on
gasoline will increase to P9 per liter, diesel to P4.50 per liter, kerosene to
P4 per liter and LPG to P2 per kilogram.
On Tuesday, Duterte
asked Finance Secretary Carlos Dominguez III to look into the proposal to
suspend the fuel excise tax hike.
At the Senate, minority
senators Paolo Benigno Aquino IV and Francis Pangilinan filed a joint
resolution calling for the suspension of the excise tax hike on fuel and its
rollback to pre-TRAIN law levels.
Joint Resolution 15
yesterday was taken up on first reading in the plenary and was referred to the
Senate committee on ways and means.
The resolution seeks an
urgent intervention of the Congress to mitigate the inflationary effects of
rising fuel prices by suspending the increases.
The senators said that
since December 2017, gasoline prices have increased by P10.50 per liter, diesel
by P12 and kerosene by P14.12.
Citing Duterte’s
statement that he is open to suspending the fuel tax hike, Aquino said the
resolution they filed “will show what the Senate feels about this measure.”
He said a counterpart
bill in the House would be filed by Marikina Rep. Romero Quimbo.
If adopted by both the
Senate and the House, Aquino said the resolution would carry the force of law.
House Minority Leader
Danilo Suarez also expressed support for scrapping of fuel taxes. – With Alexis Romero, Danessa Rivera,
Marvin Sy, Ding Cervantes
No comments:
Post a Comment