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Sunday, July 03, 2005
Consumer groups ask gov't to monitor price rollback
By Cheng Ordoņez
THE Supreme Court decision to temporarily stop the implementation of the expanded value-added tax (EVAT) led consumer groups to ask the Department of Trade and Industry (DTI) to monitor the impact on the prices of basic commodities made by the July 1st implementation of the law, and ask businessmen who implemented EVAT that day to roll back it prices.
Prior to the Supreme Court (SC) decision late Friday to temporarily stop the implementation of Republic Act (RA) 9337, the DTI was to further raise awareness on the impact of the VAT law by enjoining Local Government officials to identify areas of cooperation in protecting the interests of the consumers. One area where DTI and LGUs could have cooperated is in the monitoring of basic goods' prices in wet markets and supermarkets.
However, the high court set the case for oral arguments on July 26 and ordered Finance Secretary Cesar Purisima and Bureau of Internal Revenue (BIR) Commissioner Guillermo Parayno to answer within 10 days the petitions questioning the legality of the law.
With this, the consumer groups have asked the trade department and other concerned government agencies to monitor, instead, the lowering of prices back to its previous prices and keep watch at market activities to ensure that prices are within reach by consumers and prevent unscrupulous businessmen from taking advantage of the passage of the new law.
The DTI, earlier, also enlisted the help of labor groups to monitor prices of basic agricultural and manufactured commodities, and to step up consumer protection against profiteers in the market.
The increased monitoring efforts of the DTI and the local government units will not necessary bring down prices but will ensure the availability of basic goods at reasonable prices, and to protect consumers against undue price increases caused by unscrupulous individuals. Local government units are key in ensuring stable prices in the market, the DTI assures though.
The DTI regional office here said the VAT law is part of the reform program that the administration is carrying out to improve the country's revenues. It is a vital component of the government's fiscal consolidation program that aims to bring the fiscal deficit GDP to zero by 2010, if not sooner.
Trade Secretary Juan B. Santos earlier said that prices of commodities would remain stable in spite of the signing of the VAT reform measure into law. The 2% increase in the value added tax will have an effect only in 2006 and if the President at that time exercise her stand-by power, which could only be done when any of the two set conditions are met. The two conditions are: when VAT-collection-to-GDP ratio in 2005 exceeds 2.8% or when the National Government deficit-to-GDP ratio for 2005 exceeds 1.5%.
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