Philippine Daily Inquirer


- By Chris­tine O. Aven­daño @10aven­danoINQ Business · Finance · Taxes · Latin America News · Politics · Energy · Industries · Benjamin Diokno · Joel Villanueva · Value Added Tax

Sen­a­tors on Thurs­day again urged the gov­ern­ment to sus­pend or re­view higher taxes on fuel and other prod­ucts, and finds ways to help the poor get by amid ris­ing in­fla­tion.

Sen. Pan­filo Lac­son said a re­view of the Tax Re­form for Ac­cel­er­a­tion and In­clu­sion (TRAIN) Act was nec­es­sary, es­pe­cially the ex­cise on oil.

Lac­son said the ex­cise on oil af­fected do­mes­tic gas prices and elec­tric­ity rates, as the power in­dus­try also used oil.

He also asked eco­nomic-man­agers to re­view their pro­jec­tions for the econ­omy now that the in­fla­tion rate has hit 5.2 per­cent.

Weak peso bad

Speak­ing at a news fo­rum in the Se­nate, Lac­son dis­agreed with Bud­get Sec­re­tary Ben­jamin Dio­kno’s as­ser­tion that a weak peso was not bad for the coun­try.

Lac­son said the ex­change rate had risen to P53.40 to $1, or P6 more than the pre­vi­ous rate of P47.03.

He said this would im­pact on the coun­try’s pay­ment of $73 bil­lion in for­eign debt be­cause of the ad­di­tional P446 bil­lion gen­er­ated by the peso’s fall.

“So isn’t a weak peso bad for the econ­omy?” Lac­son said, not­ing that the coun­try also im­ported raw ma­te­ri­als that now cost more, thus a weak peso was “bad for the econ­omy.”

Op­po­si­tion Sen. Bam Aquino said the gov­ern­ment should sus­pend the TRAIN law that took ef­fect in Jan­uary, as he noted that the in­fla­tion rate had dou­bled in one year.

“The mes­sage is clear on the 5.2-per­cent in­fla­tion rate. We need to stop TRAIN im­me­di­ately be­cause peo­ple are drown­ing from the high prices of com­modi­ties,” Aquino said in a state­ment.

Sus­pend TRAIN law

Aquino has filed a bill propos­ing the sus­pen­sion of the TRAIN law and rais­ing the ceil­ing for tax-ex­empt in­come but im­pos­ing higher taxes on oil and other prod­ucts.

Sen. Joel Vil­lanueva sought the low­er­ing of the 12-per­cent value-added tax to 10 per­cent and the re­peal of “un­nec­es­sary and in­ef­fi­cient VAT ex­emp­tions.”

In a state­ment, Vil­lanueva also said the gov­ern­ment needed to work to lib­er­al­ize the im­por­ta­tion of rice in the coun­try.

“We re­it­er­ate our call to the gov­ern­ment to check and find ef­fi­cient means of man­ag­ing in­fla­tion through sound eco­nomic poli­cies,” he said.

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