MANILA – At least three senators on Tuesday expressed concern on the inflationary effects of Tax Reform for Acceleration and Inclusion (TRAIN) law, with one of them even calling for the suspension of the law’s implementation.
In a statement, Sen. Joseph Victor “JV” Ejercito asked government economic managers to suspend the law’s implementation amid the acceleration of inflation rate to 4.5 percent year-on-year in April, the fastest in more than five years. The full-year target is 2-4 percent.
“The economic managers should seriously review the TRAIN law given the upward trend of the numbers,” he said.
“They should assess whether the increase in inflation is still manageable. Otherwise, implementation of TRAIN 1 should be suspended and re-studied.”
Ejercito said during the Senate deliberation of the TRAIN bill, both the Department of Finance and the National Economic Development Authority claimed that the measure would likely raise the inflation level by just 0.7 percent this year.
He said the two agencies even assured the senators that the inflation rate would still be within the projected 2-4 percent target.
“Pero mukhang ang layo yata ng sinabi nila noon sa mga numero na lumalabas ngayon,” Ejercito said.
He said the idea of the tax reform was to decrease the personal income tax, giving the people more purchasing power. However, the rising prices of commodities would negate the positive impacts of TRAIN law on income.
“My worst nightmare about the TRAIN law has become a reality. I had warned this before that the TRAIN is inflationary in nature. The common people may not know what inflation is, and they don’t care. What they do know and what they care about is that prices of food and other necessities have all gone up,” Ejercito said.
In an interview with reporters, Sen. Bam Aquino also expressed concern on the inflation because of TRAIN law, but did not call for the suspension of its implementation. He said they would have a clearer picture after the Senate Committee on Economic Affairs holds its hearing on the effects of TRAIN law on Wednesday.
“So we are happy that we have this hearing tomorrow, gusto nating malaman ‘yung pagtaas ng presyo, sobra-sobra na ba ito sa kakayanan ng taumbayan dahil sa aming pag-iikot parang ganun na nga ang lumalabas,” he said.
He said he is looking into the suspension of excise tax on petroleum products under the TRAIN Act, which imposes P7 and P2.50 additional levy on gasoline and diesel, respectively.
“So gusto po naming malaman baka panahon na po na ipasuspindi muna natin ‘yung excise tax natin para naman magkaroon ng breathing room ang ating mga kababayan at kitang kita natin na talagang mabigat na masyado ang presyo po dito sa ating bansa,” Aquino said.
He said the senators also wanted to know if the P200 per monthly dole-out for the 10 million poorest households affected by TRAIN law is being implemented.
Aquino said if they find out during the hearing that the dole-out is not enough for the families, they might propose to increase it to P400 or P500 per month.
Sen. Sherwin Gatchalian, chairman of the economic affairs committee, said the Congress can propose the suspension of TRAIN law if they would find out that it is becoming more of a burden to the Filipino people.
“Highly possible that the legislative branch will recommend the suspension of the implementation. Bukas natin malalaman dahil importante dito ‘yung pinakamahirap nating kababayan, ‘yung talagang hand to mouth ang kanilang existence. Dapat maprotektahan natin sila at di malagay sa alanganin ang kanilang pamumuhay,” he said.
However, he said they should study the proposed suspension thorougly because such move would have an effect in the revenue collection.
“Dapat nating malaman may iba’t ibang epekto ang pagsu-suspend niyan especially pagdating sa revenue collection dahil diyan din nakasalalay ung ‘Build, Build, Build’ program natin so babalansehin natin, titignan natin kung ano ba ‘yung positive and negative effects,” he said. (GMA News)
