Veco assures minimal effect on power prices

The implementation of Tax Reform for Acceleration and Inclusion (TRAIN-1) early this year will only have very minimal effects on electricity rates, assured the Visayas Electricity Company (VECO).

VECO president Jim Aboitiz clarified that while majority of power suppliers contracted by VECO are sourcing their power supply from geothermal and hydro plants, the high fuel prices will not adversely influence the electricity rates.

Aboitiz, who is also the Executive Vice President and Chief Operating Officer of AboitizPower Distribution Group assured electricity consumers that the high cost of fuel partly brought about by the tax reform only has very little effect on the Aboitiz distribution business.

TRAIN is the first package of the comprehensive tax reform program (CTRP) envisioned by President Duterte’s administration, which seeks to correct a number of deficiencies in the tax system to make it simpler, fair and more efficient.

The first package of tax reforms, which took effect on January 1, spread out the increase in fuel taxes over three years from this year until 2020,

Aside from fuel, the government also raised duties on sugar-sweetened drinks and cars to help offset a reduction in personal income tax rates and fund the government's infrastructure program.

A second tranche of reforms submitted to lawmakers this year seeks to revise fiscal incentives.

Meanwhile, Aboitiz expressed concerns on the proposal to implement TRAIN-2 as this would threaten the appeal of the Philippines to investors.

Aboitiz joined other prime movers in the business sector in calling the government to clarify and study seriously the portion on cutting-off the fiscal perks of investors.

Aboitiz said the government should make further clarifications on the Train 2 proposal.