CLARK FREEPORT – The government’s announced suspension of excise tax implementation next year is misleading, as it would merely suspend the tax increase of P4.50 per liter for diesel and P9 for gasoline not the current excise tax already imposed by the Tax Reform for Acceleration and Inclusion (TRAIN) Law.
“The government has neglected the already catastrophic socio-economic impact of TRAIN’s first tranche excise tax on fuel,” Anakpawis Partylist Rep. Ariel Casilao said in a statement yesterday.
“What the poor is demanding is the scrapping of regressive provisions of the TRAIN Law, especially the excise tax on oil products that has triggered the skyrocketing of prices especially food items,” Casilao said.
He said that under the government’s announcement of excise tax suspension next year, “the imposition of P2.50 excise tax per liter of diesel, and P7 per liter of gasoline remains, and what was actually suspended was increasing it to P4.50 and P9, respectively.”
Casilao noted that in 2010, about 1.3 billion liters of diesel were used for transport, and another 1.1 billion liters for machineries and equipment.
“Thus, imposing the excise tax would roughly add P6 billion to the costs of production,” he said.
“The added costs in production, are obviously passed on to consumers via surged levels of prices. It is elementary to conclude we are facing unabated inflation to a large extent because of the first tranche of the TRAIN Law imposition of excise tax, not the forthcoming second tranche next year,” he stressed.
He said that “the suspension of the second tranche next year is the administration’s very own admission of the calamitous impact of the TRAIN Law in the country. The implementation triggered broad people’s protest and condemnation leading to the presidency’s dwindling trust ratings.”
“The suspension of the excise tax imposition next year was actually a desperate measure. As we all know, the first quarter is very crucial when majority of the poor are totally drained of means of livelihood. Also, historically, the people power protests were carried out on a February and January,” Casilao also said.
