By Genalyn D. Kabiling
The government opposes the proposed suspension of the implementation of the new tax reform law despite complaints of soaring consumer prices.
Suspending the Tax Reform for Inclusion and Acceleration law could have an adverse impact on the funding of government projects such free tuition in state colleges and universities, according to Assistant Secretary Paola Alvarez of the Department of Finance.
In the wake of high local oil prices, Sen. Bam Aquino proposed a bill aiming to suspend the excise tax on fuel products if inflation rate exceeds the government’s target. The measure seeks to amend the TRAIN law to protect the people from soaring prices of goods and services.
“Ang crucial po kasi dito is, we cannot just suspend it, kasi po iyong ating mga funding, lalung-lalo na po iyong sa free state universities, lahat po iyan iyong ating mga gustong pondohan, iyong mga increase sa salary ng ating personnel, ng ating mga guro, lahat po iyon, iyong plans natin to find all those, mahihirapan na po tayong pondohan iyon, kung ating isu-suspend iyong ating mga provisions nga po na ating binanggit,” Alvarez said during a Palace press briefing.
Besides, Alvarez said the TRAIN law has a provision that would suspend the next increase of fuel excise tax if the Dubai crude oil would reach $80 per barrel. “We inserted mitigating measure when crude oil reaches $80 per barrel, we will suspend in the succeeding year,” she said.
Alvarez expressed hope that such threshold would not be breached amid reports that Russia and Saudi Arabia plan to boost oil production to ease world prices.
She said that the TRAIN law should not be solely blamed for the oil price increase, which she attributed to rising world oil prices and weakness of the peso.
She said TRAIN accounted only for 0.4 percent of the 4.5 percent inflation rate. Fuel excise tax only contributed a fraction of oil price hike, or P3 in gas retail prices and R2.80 in diesel prices.
