Friday, April 28, 2006
Cut in tariff to cushion oil price hike impact: Palace
MALACAÑANG said Thursday the reduction of the tariff on oil is the "best option" to mitigate the impact of soaring oil prices without sacrificing economic growth.
"We believe this is a win-win solution for all," said Press Secretary Ignacio Bunye.
Bunye, who is also the Presidential spokesman, said the government is considering the decrease of the three percent import tariff on oil further. Presidential chief of staff Michael Defensor said government can reduce the tariff to as low as zero.
Energy Secretary Raphael Perpetuo Lotilla, in a presentation before the Cabinet on Wednesday, said at one percent tariff, pump prices would be reduced from the current P38.24 per liter to P37.64 for unleaded, from P36.06 to P35.46 for regular gasoline, from P34.24 to P33.60 for diesel, and from P35.77 to P35.14 for kerosene.
At zero percent tariff, pump prices would go down to P37.33 for unleaded, P35.15 for regular, P33.29 for diesel, and P34.82 for kerosene.
President Gloria Macapagal-Arroyo is expected to issue an executive order reducing the oil tariff before Congress resumes session on May 15.
Bunye said government will continue to expand the safety nets for the people by keeping a tight watch on the prices of other basic commodities and increasing the number of gasoline outlets giving P1 diesel discounts.
He said Arroyo has ordered the Cabinet to examine all options to mitigate the effects of higher global oil prices. He said the President will discuss the issue with Saudi's King Abdullah Bin Abdul Aziz Al-Saud on her visit in Saudi Arabia on May 7-10, 2006.
The Cabinet rejected the suspension of the expanded value-added tax (e-VAT) on oil, the implementation of a four-day workweek for government employees, daylight saving time (DST), and the suspension of fuel requirements under the Clean Air Act as possible mitigating measures.
It preferred the tariff reduction, expansion of the P1 diesel discounts, and the development and use of alternative fuels. (JMR/Sunnex)
(April 28, 2006 issue)
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