House tackles bill on P6 diesel tax

MANILA, Philippines -  The House of Representatives is set to tackle today the bill that will impose a tax of P6 per liter on diesel, liquefied petroleum gas (LPG), kerosene and bunker oil used for generating electricity.


The bill also proposes to increase existing taxes on other petroleum products, including gasoline and aviation fuel.


The proposed new P6 tax and increased levies on oil products are feared to result in higher transportation cost, fares and consumer prices that would hurt every Filipino.


The impositions are set to take effect on Jan. 1, 2018.


Aside from these levies, the measure scraps value-added tax (VAT) exemptions on many products and services, including money remittances.


The bill, however, is not all about new and higher taxes; it likewise proposes to cut the income tax of millions of workers, professionals and self-employed individuals.


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Administration lawmakers are supporting the proposed law despite its across-the-board adverse impact on the population.


“It will help the administration accomplish its primary objective of high and inclusive growth, as provided for under President Duterte’s 10-point socioeconomic agenda,” Camarines Sur Rep. Luis Raymund Villafuerte, an appropriations committee vice chairman, said.


He said the tax reform bill is designed to cut income tax rates for workers and at the same time help raise money for Duterte’s massive expenditure program to lift ​six ​million Filipinos out of poverty and transform the Philippines into an upper middle-income country by 2022.


On the other hand, Navotas Rep. Tobias Tiangco, an independent, urged his colleagues to scrap the proposed excise tax.


He said the planned imposition “will definitely result in the increase of the daily expenses of countrymen, most of whom are living below the poverty line.”


Administration congressman Winston Castelo of Quezon City said the House should revise the tax proposals.


Other administration lawmakers, including the Visayas bloc of Negros Occidental Rep. Alfredo Benitez, are suggesting a provision in the bill that would automatically suspend the P6 tax on diesel, kerosene, cooking gas and bunker fuel once crude oil prices reach $80 per barrel.


That crude price level translates to a pump price of about P80 per liter for gasoline. At present, crude sells for $50 in the world market. The local price of high-octane premium gasoline is P50.30 per liter.