AN official of the Bangko Sentral ng Pilipinas (BSP) stressed that the government has been putting in place measures to mitigate the “temporary” impacts of the tax reform law including the increase in prices of commodities.
Zeno Ronald Abenoja, senior director of the Department of Economic Research of the BSP, said these measures are positioned to prevent an increase in prices, for instance, from translating into second ground effects.
Abenoja said through unconditional cash transfers for lower segments of the population, the government will be spending billions to provide a subsidy to poor families.
“The government targets to cover 10 million households by the third quarter of this year,” he said, adding that this aims to also help manage the income of poorer households.
The government is also developing the “Pantawid Pasada”, a subsidy program for the public utility sector so that they will also have amelioration in addressing the impact of higher fuel pump prices.
The Department Trade and Industry, Department of Agriculture, and Department of Energy are monitoring prices of commodities also to make sure there is an adequate supply of basic commodities in the market, the BSP official further said.
The government is also working with the legislation to pass the tariffication of the rice industry.
Abenoja said, though the BSP is not involved in this initiative, the agency recognizes its importance like helping lower domestic rice prices, and help the households across the country cope with price increases on general products.
“These measures are already being implemented so that negative but transitory impacts of the tax reform law can be managed by the households,” he told reporters at the sidelines of the Conference on Gearing Up for External Competitiveness in Bacolod City Tuesday, May 15.
The country’s economy has maintained the momentum by growing faster at 6.8 percent during the first quarter of this year.
Amid this consistent growth trend, the government recognizes the need for infrastructures, both physical and human.
Abenoja said in the past few years the government has been spending about two to four percent of the gross domestic product (GDP) for physical infrastructure.
But by 2022, it targets to increase it to seven percent to improve economic capacity.
“The first phase of Train will help us finance these infrastructures and help expand the productive capacity of our economy,” he said, adding that the tax reform will not only raise revenue but also to make sure that the wider segment of society is benefited.