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[av_heading heading=’PEOPLE POWWOW ‘ tag=’h3′ style=’blockquote modern-quote’ size=” subheading_active=’subheading_below’ subheading_size=’15’ padding=’10’ color=” custom_font=” av-medium-font-size-title=” av-small-font-size-title=” av-mini-font-size-title=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” admin_preview_bg=”]
BY HERBERT L. VEGO
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PRESIDENT Rodrigo Duterte was obviously lying when he described the “railroaded” Tax Reform for Acceleration and Inclusion (TRAIN) measure as his administration’s “biggest Christmas gift to the Filipino people” aimed at supporting the government’s P3.7-trillion budget for 2018.
No less than the chair of the Senate committee on ways and means, Sen. Juan Edgardo “Sonny” Angara, had initially opposed increasing excise taxes on fuel products for being “anti-poor,” only to reverse himself in the wake of President Rodrigo Duterte’s second State of the Nation Address, where he had urged the Senate to pass Malacañang’s version of the tax reform bill in its entirety.
How could a law that would increase excise taxes benefit the poor consumers who would consequently shoulder the burden?
The half-truth is that employees earning P250,000 or less per year would no longer pay income tax. Well, most people within that bracket are already tax-exempt for having dependent children or having no regular jobs.
Clearly, the touted tax exemption merely saves the purpose of sugar-coating a bitter pill – higher cost of living.
The producers of food products who already reel from 12 percent value-added taxes would have to pass on the added excise taxes to consumers. For example, a liter of soft drink would cost at least six pesos more because that is the excise tax to be imposed effective January 2018.
The president of Toyota Motors Philippines Corp. (TMP), Satoru Suzuki, predicted a 10 percent decline in sales of their motor vehicles because of the “tax reform.”
Expect transportation fare increases resulting from the imposition of excise taxes on diesel at P2.50 per liter in 2018, P4.50 the following year and six pesos in 2020; gasoline at seven, nine and ten pesos, respectively.
The only way to fend off the consequential price increases of prime commodities is to earn much more. Lucky are the military and police forces; they would be paid double their present salary.
Despite the expected burden that TRAIN would heap on the poor, a senator expressed discontent with the excise taxes to be levied on local coal. Since coal is still not imposed value-added tax (VAT) in the new tax law, he wants it also in the forthcoming second phase of TRAIN bill.
“Dapat maisama ‘yan at hindi tayo papayag na hindi kasama yan,” Villanueva told the Senate reporters.
This corner begs to disagree, knowing that coal had purposely been left out during the latest revision of the VAT law in 2006 to keep its reputation as “cheapest form of energy.” Aside from business permits and income taxes, all that was imposed on coal then was excise tax of P10 per metric meter.
But with TRAIN, excise tax on coal will be raised to P50 per metric ton in 2018, P100 in 2019 and P150 in 2020. No doubt this would force Semirara Mining and Power Corporation (SMPC) to pass the burden on to energy generators, to energy suppliers (mostly electric cooperatives) and on to industrial and residential consumers.
For a little bit of history, SMPC was incorporated on Feb. 26, 1980 to explore, develop and mine the coal resources in Semirara Island located in Caluya, Antique under operating contract with the Department of Energy (DoE).
SMPC is just a subcontractor of DoE. The mining reservation covering the entire Semirara Island – which is a part of Caluya, Antique – has always been state-owned. No less than President Manuel Luis Quezon declared the island as a national coal mining reservation through Proclamation No. 649 dated November 20, 1940.
SMPC is the biggest contributor to the progress of Caluya, which, under the leadership of Mayor Genevive Lim Reyes, has jumped from fourth class to first class municipality. (hvego@gmail.com/PN)
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