Iloilo Business Club monitors effects of TRAIN

THE ILOILO Business Club (IBC) is monitoring the impact of the Tax Reform for Acceleration and Inclusion (TRAIN) law, which takes effect this year, on the prices of goods as well as the overall local economy. IBC Executive Director Lea E. Lara said their initial assessment indicates that the tax adjustments have positive and negative effects on Ilonggos. She said majority of Ilonggo workers are seen to benefit from the income tax reduction as many are middle income earners. Employees earning an annual P250,000 and below are tax-exempt. “I think 60% of our workers are fixed income earners. So the adjustments will incredibly help them,” she said. While many will benefit from the income tax cut, Ms. Lara recognized that the law will also affect purchasing power as TRAIN imposes higher taxes for fuel, sweetened products, and tobacco. She said the domino effect on consumer goods will be felt around February or within the first quarter. “We give it one quarter to see how it will manifest in the movement of prices as some are still working on their inventories. We will immediately feel its effect on transportation cost but as to the full effect, we will see,” she said. On the part of local businessmen, Ms. Lara said the club has not received negative reactions when the tax reform was proposed.“It was mixed feeling I would say. We welcome the law as it would help the employees. But we also recognize how it will manifest on the cost of goods,” she said. —