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Monday, August 15, 2005
Postpone new VAT till crisis passes
A CEBU City councilor is asking the President and both Houses of Congress not to implement the expanded value-added tax (E-Vat) to avoid another round of oil price increases.
With President Arroyo calling on the public to cut down on the use of fuel, Councilor Arsenio Pacaña asked in turn for the President to have the political will to solve the economic and oil crises and consider setting aside the E-Vat.
Pacaña fears oil prices will again increase, adding to the consumers’ burden, once the Supreme Court lifts the temporary restraining order on the implementation of the revised E-Vat law.
The E-Vat Act of 2005, or Republic Act 9337, expands the tax’s coverage to include, among others, the sale of electricity and petroleum products, the importation or sale of coal and natural gas, and the services of doctors and lawyers.
It also gives President Arroyo the power to increase the E-Vat rate from 10 to 12 percent by early 2006, if the country’s need for revenues requires it.
Volatile
But in a proposed resolution, Pacaña urged Arroyo and Congress to prioritize the economy and set aside the E-Vat “so as not to aggravate the country’s volatile economic situation.”
“Despite calls of government to adopt energy conservation measures and exploit alternative sources of fuel in order to lessen the country’s dependence on oil, the seeming lack of a policy framework and logistical support has delayed its implementation,” said Pacaña.
Seeking to cut the country’s ballooning energy bill, President Arroyo recently suggested that Filipinos walk or use their bicycles, on the heels of another round of increase in the prices of oil products.
Pilipinas Shell Petroleum Corp. and Caltex Philippines Inc. increased last Saturday the prices of their gasoline, diesel and kerosene by an average of 50 centavos per liter.
The escalating cost of oil in the world market forced oil firms to raise pump prices.
Pacaña said the oil price increases could worsen the economic and political instability in the country, “and definitely add more pressure on the people’s lives.” LCR
(August 15, 2005 issue)
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