BACOLOD City — The Alliance of Concerned Consumers in Electricity and Social Services (ACCESS) has expressed strong support for proposed Senate Bill No. 496, which seeks to exempt electricity sales from the 12 percent value-added tax (VAT) to help reduce power costs.
The measure, authored by Senator Francis Escudero, aims to ease the financial burden on households and businesses by lowering electricity rates amid rising living costs.
ACCESS said the proposed VAT exemption would provide much-needed relief to consumers, particularly low- and middle-income households and small enterprises struggling with high power rates and inflation.
ACCESS President Wennie Sancho said removing the VAT on electricity would give consumers “breathing space” and immediately translate into lower monthly power bills.
“Lower electricity costs would increase household disposable income and help ease inflationary pressures,” Sancho said, adding that the savings could be redirected to basic needs or productive investments, thereby supporting economic activity.
Sancho also noted that the exemption would benefit the business sector by reducing production costs and enhancing industrial competitiveness.
“The exemption will not only benefit households but will also help industries by lowering operating expenses, which could stimulate expansion, boost productivity, and generate employment,” he said.
ACCESS further emphasized that the proposed measure could serve as an economic stimulus as the country continues to recover from recent economic challenges. Reduced energy costs, Sancho said, would encourage higher output and sustained growth among businesses.
Senate Bill No. 496, formally titled “An Act Exempting Electricity Sales from Value-Added Tax, Further Amending for the Purpose Sections 108 and 109 of the National Internal Revenue Code, as Amended,” seeks to address the country’s persistently high electricity prices, which remain among the highest in the region.
Escudero has said that expensive electricity has long discouraged private sector investments, particularly in manufacturing, while also driving up the prices of basic goods and commodities.
High power costs, he added, contribute to broader economic problems, including premature deindustrialization and slower economic transformation.
By exempting electricity sales from VAT, Escudero said the measure would provide tax relief, lower operating costs for industries and businesses, help temper inflation, and increase disposable income for Filipino households, while potentially generating revenue through increased economic activity and consumption./PN
