Senate President Pro Tempore Ralph Recto on Thursday warned that if the government increases taxes on oil next year, this would clearly increase prices and stoke inflation.
He added that while the November inflation rate has come down to 6 percent, that is still high.
“We can only hope that oil prices will continue to go down,” Recto said, adding that the government should help those affected by rising prices just as fast as they raise taxes.
“Equally important is to spend those taxes wisely,” he added.
Senator Aquilino Pimentel III said the House has started tackling measures scrapping or suspending the excise tax on oil.
“We should also entertain the same idea too, scrap the excise tax on fuel. Let this be a lesson to all of us,” Pimentel said.
He questioned the wisdom of imposing an excise tax on an item whose price was volatile and complete beyond the country’s control.
Senator Paolo Benigno Aquino IV said it was “good news” that the House was taking up measure to correct the Tax Reform for Acceleration and Inclusion (TRAIN) Law to do away with the excies tax on fuel, which pushes prices up.
In the Senate, Aquino filed the Bawas Presyo Bill in May as well as a joint resolution repealing the excise tax on fuel.
Senator Francis Pangilinan said the joint resolution signed by opposition senators is pending before the ways and means committee.
“We do not have the numbers to have it passed. It’s up to the majority now to act on it,” he said.
Senator Sherwin Gatchalian, chairman of the Senate committee on economic affairs, said the social mitigating measures provided for in the TRAIN Law have been plagued by inefficiencies and delays, which means the 30 percent poorest of the population would bear the brunt of “creeping inflation.”
He added that the country’s economic managers themselves have admitted that they failed to account for the indirect effects of TRAIN on inflation.
