PRESIDENT Rodrigo Duterte assured the public he will not allow corruption to thrive in the government on his watch, so the public should not be “sad” over taxes.
“Do not be so sad about being taxed because your money here during my term is safe,” he said during a Presidential Awards ceremony in Malacañang on Wednesday.
On Tuesday, Duterte approved the imposition of the second round of increases in the excise taxes of petroleum products in 2019, taking heed of his economic managers’ advice to lift the suspension.
The move was done under the Tax Reforms for Acceleration and Inclusion Act (TRAIN Law) which Duterte signed last year.
Stakeholders, especially those who are in the transport sector, have been asking the government to suspend even the existing excise tax on petroleum products as it has already had a serious impact on their daily survival.
Senator Chiz Escudero meanwhile filed a resolution on Wednesday urging President Rodrigo Duterte to reconsider the implementation of the second tranche of excise tax on fuel, or at least consider its immediate suspension when inflation becomes uncontrollable again anytime in 2019.
Duterte assured the people that he will not condone the squandering of public funds, as proven by his sacking of allegedly corrupt officials.
“I will not allow corruption. I have fired so many Cabinet members for just an infraction,” he added.
Duterte recently fired a housing official over corruption allegations.
Budget Secretary Benjamin Diokno earlier said the condition for suspending the fuel tax hike would no longer be present next year, and that the government stands to lose about P43.4 billion in revenues if the suspension pushes through.
The price of Dubai crude has fallen since the economic team recommended last October the suspension of the fuel tax hike. At that time, the price of the benchmark exceeded $80 per barrel, the threshold under the tax reform law that will require such a suspension.
The Development Budget Coordination Committee has revised its assumption for Dubai crude in 2019 to $60 to $75 per barrel from $75 to $85.
Diokno, meanwhile, said Dubai crude oil futures project further decline below $60 per barrel in 2019.
Diokno noted that diesel’s peak price in 2018 was P49.80 per liter and it will be P37.76 in Jan. 2019, inclusive of the P2 peso excise tax. For gasoline (95 octane) it was P60.90 at its peak, and it will be P50.82 in Jan. 2019, also inclusive of P2 additional excise tax, he said.
Presidential Spokesperson Salvador Panelo said Duterte heeded the recommendation of his economic managers to push through with the hike because of reduced global oil prices and its impact on the government’s budget and infrastructure programs.
“If you suspend it, then it will affect your budget, the personnel services of the national government. If you do that, we will be losing P43 billion in revenues,” Panelo said.
“It will affect the entire services, budgets, infrastructure programs of the government and that will be bad for the people.”
The Tax Reform for Acceleration and Inclusion (TRAIN) scheduled excise tax increases every year for 3 years starting Jan. 1, 2018, when duties were increased by P2.50 per liter for diesel, P1 per kilo of LPG, and P2.65 per liter of regular and unleaded gasoline.
TRAIN imposed excise taxes on diesel for the first time while the levy on regular and unleaded gasoline was raised to P7 from P4.35.
The economic team earlier recommended the suspension of the second tranche as inflation hovered at near 10-year highs. The price increases steadied at 6.7 percent in September and October, but it tapered to 6 percent in November.