Transport fares must not increase because of TRAIN

Public transportation fares should not go up as a result of the excise tax rates on petroleum products under the recently enacted tax reform law, the Department of Energy (DOE) said on Friday.

“Paniniwala ng Department of Energy na hindi naman automatic ‘pag umakyat ang presyo ng gasolina dapat automatic na umakyat ang transport fares,” Energy Assistant Secretary Bodie Pulido told reporters in a press conference in Taguig City.

The recently approved tax reform law, or Republic Act No. 10963, imposes an excise tax of P2.50 per liter on diesel—from zero—while the excise tax on gasoline is raised to P7 from P4.35.

By 2020, the excise tax rates on diesel will go up to P6 per liter and on gasoline to P10.

Pulido said, transport fares should not increase since the tax reform law has mitigating measures such as fuel subsidies for public utility vehicle drivers. “Katulad po ng ginawa noong 2014 na may pantawid pasada program,” the Energy official said.

“And, historically, noong sumipa ng P46 (per liter) ang diesel noong 2014 hindi naman umakyat ang fares ... Kaya po ang paniniwala ng Department of Energy it does not necessarily follow,” Pulido said.

He added that the DOE will raise its concern regarding the petitions for fare increase of several transport groups to the Land Transportation Franchising and Regulatory Board.

The DOE is now talking to several oil companies about providing, renewing, or expanding discount mechanisms for the benefit of public utility vehicle driver, a benefit that would eventually lessen the pressure on transport fares.

In the coming weeks, Pulido said the department will be executing agreements with the oil companies and formalize results of the talks. The goal is to make fuel price discounts a part of the oil firms’ corporate social responsibility.

Three factors make it imperative for transport fares not to go higher, the DOE said:

* mitigating mechanisms of the TRAIN law * social responsibility programs of oil companies * correlation of historical data on petroleum prices and fare rates

Pulido said the oil price increases in 2014-2016 did not have a significant impact on the price of rice and transport fares.