Arroyo welcomes inflation rate drop

December 05, 2018
Gloria Macapagal Arroyo
Gloria Macapagal-Arroyo

SPEAKER Gloria Macapagal-Arroyo yesterday welcomed the drop in the inflation rate even as the chairperson of the House Committee on Ways and Means called on the country’s economic managers to drop their recommendation for President Rodrigo Duterte to implement an additional P2 in fuel excise tax per liter next year.

“Well, I’m very happy to hear about the easing inflation,” Arroyo told reporters in an ambush interview after the Philippine Statistics Authority (PSA) said that the inflation in November slowed down to 6 percent from 6.7% last October.

“I guess the moral of the story is, when there is a supply side inflation, then we increase the supply. But we should do it as soon as we detect the supply side inflation,” said Arroyo.

Nueva Ecija Rep. Estrellita Suansing, the chairperson of the House Committee on Ways and Means, said the implementation of the excise tax on petroleum products next year should be suspended

“Let the President realize that many people are calling for the suspension of excise tax on fuel,” Suansing told her panel hearing yesterday on calls to suspend the collection of excise tax on fuel in 2019.

“If they will ask me, they have to reconsider [their recommendation] because of the [the excise tax’s] big impact. Let’s think of the impact of this tax to consumers,” said Suansing.

Budget Secretary Benjamin Diokno announced last Tuesday that President Duterte has approved his economic team’s recommendation to push through with the next tranche of fuel excise taxes under the Tax Reform for Acceleration and Inclusion (TRAIN) law following the “sharp turnaround in world crude prices.”

For 2019, the TRAIN Law is scheduled to increase the fuel excise tax by P2 per liter.

It called for an excise tax of P2.50 per liter on diesel, with an additional P2 to be imposed next year and P1.50 per liter in 2020.

This brings the excise tax on diesel to P4.50 per liter in 2019 and P6 per liter in 2020.

From previous P4.35 per liter, the excise tax on gasoline was increased to P7 this year, with an additional P2 increase in 2019, and P1 in 2020. For 2019 and 2020, the rates will be at P9 per liter and P10 per liter, respectively.

The Suansing panel is currently deliberating one bill and six resolutions calling for the immediate suspension of excise tax on petroleum products.

“We will prioritize it [the passage of the bill] at the committee,” said Suansing as she announced the creation of a technical working group (TWG) to consolidate all the proposals.

Calling for the suspension of the implementation of excise tax on fuel next year, Gabriela party-list Rep. Arlene Brosas said there is no reason to celebrate the inflation rate slowdown in November.

“Walang dapat na ipagdiwang sa pagbaba ng inflation rate kasi hindi pa bumabalik ang presyo ng mga bilihin sa antas bago ang implementasyon ng TRAIN Law. Ang totoo, patuloy pa ring tataas ang presyo ng mga bilihin pagpasok ng Bagong Taon,” said Brosas.