Several senators on Thursday welcomed the move of the House of Representatives to look at various proposals to scrap or suspend the scheduled increases in the excise tax on fuel and petroleum products under Republic Act 10963 or the Tax Reform for Acceleration and Inclusion (TRAIN) law.
On Wednesday, the House Committee on Ways and Means created a technical working group to review the proposals with the hope of striking a “workable balance between the revenue interest of the government and the financial well-being of the country.”
Senator Sherwin Gatchalian said a review of the matter is welcome as it would give lawmakers the opportunity to carefully study if the scheduled hike in fuel excise tax is necessary in light of the prevailing levels of inflation.
“Magandang nire-review ng lower house ang excise tax para lumabas din dun ang mga dahilan kung bakit nagpalit ng isip ang economic managers pagdating sa suspension (It is good that the House reviews the excise tax so that the economic managers would have a chance to explain why they changed their decision to suspend),” he said in an ambush interview.
The chair of the Senate Committees on Economic Affairs and Energy said senators would also have the chance to look if the scheduled increases are necessary given the still high inflation rate.
From a peak of 6.7 percent in September, inflation rate eased to 6 percent in November.
“Magkakaroon tayo ng pagkakataon na mapag-aralang mabuti kung itutuloy o hindi ang suspension (We will have the chance to carefully study if we suspend or not),” Gatchalian said.
Gatchalian, however, said it would take an enabling law to suspend the fuel excise tax increases scheduled for 2019, noting that he has recommended a temporary suspension of the scheduled increases for at least the first three months next year.
“This would further ease inflationary pressures and also gives the bottom 30 percent of our population most adversely affected by high inflation to recover,” Gatchalian said.
He added that three months is also the time needed for government to fully distribute the unconditional cash transfers and fuel subsidies to all the beneficiaries identified in the TRAIN law.
Meanwhile, Gatchalian said the government should closely monitor global oil prices because of the volatility of the oil market.
He also urged the Department of Trade and Industry and the Department of Energy to closely monitor “profiteering” next year as part of government efforts to stabilize the price of goods and petroleum products.
“Kailangan nilang bantayan nang maigi na walang hoarding na mangyayari para hindi bumulusok pataas ang presyo ng krudo at ng bilihin sa bansa (Strict monitoring is needed to prevent hoarding so that prices of goods and oil in the country would not rise dramatically),” Gatchalian said.
Senator Aquilino Pimentel III, on the other hand, also welcomed a review of the scheduled fuel excise tax increases.
“We should also entertain the same idea, to scrap excise tax on fuel,” he said.
“Let this be a lesson to all of us: it is very difficult to impose an excise tax on an item whose price is unstable and very volatile, and completely beyond our control and even our influence whatsoever,” Pimentel said.
For Senator Paolo Benigno Aquino IV, the move is “good news that the House is starting to tackle measures to correct the TRAIN law and do away with the excise tax on fuel which pushes prices up.”
The lawmaker said he already filed a joint resolution in the Senate seeking to repeal the excise tax on fuel.
“Hopefully, the Senate can follow suit and tackle these crucial measures before the end of the year,” Aquino said.
Senator Francis Pangilinan, meanwhile, said the joint resolution filed by Aquino that was signed by the opposition senators is pending before the Ways and Means Committee.
“We do not have the numbers to have it passed. It is up to the majority now to act on it,” Pangilinan said.
But Senator Sonny Angara, the chair of the Senate Committee on Ways and Means, said they will have to wait for the House to pass its version first before his panel could start acting on the joint resolution, and all other tax measures for that matter.
“Basta ang usapin sa buwis, kailangan magmula yan sa Kamara sa ilalim ng Saligang Batas. Hindi po namin pwedeng ipasa yun hangga’t di naipapasa ng Kamara ang kanilang version (Under the Constitution, all tax measures must emanate from the House. We cannot pass the measure until the House passes its own version),” the chair of the Senate Committee on Ways and Means said in an interview.
Once the House submits its version, Angara assured that the Senate will immediately act on it.
But even if the House manages to pass the measure before Congress goes on Christmas break, he noted that the Senate would be hard-pressed to act on it due to the ongoing deliberations on the proposed 2019 national budget.
“Pag usapan namin saka ng liderato. Sa ngayon busy kami sa budget. Ang pakiusap nga sa amin, we pass it (budget) before yearend (We will have to talk with the leadership about it. Right now we are busy with the budget. We were requested to pass it before yearend),” Angara said.
He also urged the government to “speed up the implementation of mitigating measures” that were provided under the TRAIN law to ease the burden from poor families who will be most affected by the new round of fuel excise tax increases.
Proponents of the measure at the House of Representatives have expressed concern that continuing the tax hike as scheduled would further increase the prices of goods and would have a dramatic impact on the poor.
However, the Department of Finance maintained that the recent rice supply problem early this year, as well as the high cost of crude oil in the world market, were the main culprits behind the high inflation level, not the imposition additional of taxes on fuel.
It pointed out that this was proven when the continuing decrease in global prices of petroleum products and the easing of rice supply constraints due to importations have caused the easing of inflation.
The Finance department also pointed out that the passage of the rice tariffication law would further ease the rice supply situation which, it stressed, has a much greater impact on inflation. (PNA)