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Duterte vacillates on fuel excise taxes

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Duterte vacillates on fuel excise taxes

Given the strong clamor from various sectors of the society and even from his own allies, President Rodrigo Duterte is now open to listen on the possible suspension of the excise taxes on fuel to mitigate the effects of skyrocketing prices of basic commodity.

The President said, “Maybe,” when asked if he would support a suspension of the excise taxes.

He intimated that asked already asked Finance Secretary Carlos Dominguez III to look into the proposal, which some sectors said would provide relief to consumers.

Even some senators have endorsed a resolution calling for the suspension of excise taxes on petroleum products to mitigate the impact of soaring prices which is headed by Committee on Energy Senator Sherwin Gatchalian. While Sen. Franklin Drilon said that the President could also ask lawmakers (referring to his allies) to issue a resolution that would allow him to suspend the taxes.

While Duterte believed that the inflation is caused by rising oil prices in the world market. He said unlike other countries, the Philippines has no oil reserves, making it vulnerable to price shocks.

Meanwhile, Majority Leader Juan Miguel Zubiri said they will not touch the second tax reform package of the Duterte administration until the government manages to slow down the rising prices of goods as he and several other senators met with Duterte and economic managers in Malacañang where the second wave of the Tax Reform for Acceleration and Inclusion (TRAIN 2) was briefly discussed.

Zubiri said that Finance Secretary Carlos Dominguez III is already expecting that the TRAIN 2 would not pass in the Senate this year.

According to Zubiri, “The Finance Chief is asking if the Senate can pass the TRAIN 2 next year.” But he said that he and his colleagues in the Senate admonished Dominguez to prioritize the pressing problems on inflation, stabilize the inflationary pattern when it comes to food and other services and then maybe we can discuss other tax measures.”

He added that senators were more agreeable to the proposed tax amnesty bill, which he said would not hit the poor, trigger increase in prices and at the same time allow the government to collect from tax evaders.

Zubiri added, “It’s (tax amnesty) a chance for them to pay the right amount of taxes without the legal impediment of filing charges against them. That was the discussion last night,” adding that the measure may be passed in January and is expected to raise P30 billion.

For his part, Sen. Sonny Angara, chairman of Senate committee on ways and means, last month said the panel is suspending its deliberations on TRAIN 2 until the Department of Finance (DOF) is able to present credible data that the revenue measure will not lead to loss of jobs which was already expressed and dreaded by Employers Federation of the Philippines (ECOP) who also asked the President to suspend the excise tax on fuel being the main driver to inflation and skyrocketing prices of goods and services.

For the Philippine representative of the United Nations Children’s Fund, Lotta Sylwander, claimed that the inflation would also have an impact on the health of children.

“Family income matters for nutrition. It’s sad that the inflation now is so rapid that it can actually directly or indirectly harm children’s health. But as I said, we believe that there’s more to it than just poverty issues,” she said, noting that there are also other factors that contribute to the health of children.

While nothing is cast on stone yet, the fact that President Duterte is open to suspend the fuel excise taxes is already a welcome development for many observers. The pro TRAIN law and excise tax on fuel would use that the price of crude oil in the world market makes the pump price expensive, removing the excise tax would be a big help to many Filipino families.

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