AS consumers start noticing price increases for their purchases, government assurances of “only minimal” cost adjustments under the new tax program will be tested.
The round of fuel price increases that takes effect today, Tuesday, adds to the distress as it is the seventh consecutive weekly hike in diesel and kerosene prices and the third straight week for gasoline. Fuel price increases are directly linked to the hike in prices of goods as fuel is a basic production component.
The biggest concern about the Tax Reform for Acceleration and Inclusion (Train) Act when it took effect was that prices of goods would skyrocket. Fuel costs, plus the tendency to take advantage of a situation, might make goods expensive.
Even before the law took effect, Trade Secretary Ramon Lopez assured the public that any increase would be “only minimal.” He said that, while the new law “is perceived to possibly increase the prices of products of basic necessities and prime commodities in the market, (the Department of Trade in Industry’s) initial assessment of applying the excise tax shows only minimal impact on the prices of basic and prime goods.”
What would keep prices in check, he said, is that most manufacturers would opt to absorb the increase for fear of losing market share.
Lists of suggested retail prices for these goods were made public, and the department’s Consumer Protection and Advocacy Bureau was tasked to monitor market prices “to ensure that any increase will be nominal,” Lopez said.
A shopper walking down the grocery aisle picks up a product and immediately knows that the item has become pricier than the last purchase two weeks ago. How to check if this is overpricing? How to report a complaint? The shopper would eventually walk away with the item because she needed it and hope that her reduced income tax would cover the price difference.
As prices of goods move, and as the Train law impacts consumers, the more it becomes necessary for the Trade department to give the public information about price changes and how much is allowed.
The Consumer Protection and Advocacy Bureau comes up with price monitors. The Trade department’s website at www.dti.gov.ph has nothing on its home page on the price lists. One would have to navigate the site and go to Consumers section and drill down to the e-Presyo sub-section. It said, “e-Presyo is the online price monitoring system of the DTI where consumers can check the prevailing prices of basic necessities and prime commodities that are being monitored by the DTI. It serves as a price guide for consumers in doing their grocery shopping which in turn ensures ‘value for money’.”
Next steps should be to keep the monitors updated, make reports accessible by mobile phone and have complaints desks in public areas. Alerts by location that automatically reach mobile phones and crowd-sourced price reports would be good innovations.
The impact of the Train law can be an opportunity for government to keep people informed and involved.