Senators on Thursday again urged the government to suspend or review higher taxes on fuel and other products, and finds ways to help the poor get by amid rising inflation.
Sen. Panfilo Lacson said a review of the Tax Reform for Acceleration and Inclusion (TRAIN) Act was necessary, especially the excise on oil.
Lacson said the excise on oil affected domestic gas prices and electricity rates, as the power industry also used oil.
He also asked economic managers to review their projections for the economy now that the inflation rate has hit 5.2 percent.
Weak peso bad
Speaking at a news forum in the Senate, Lacson disagreed with Budget Secretary Benjamin Diokno’s assertion that a weak peso was not bad for the country.
Lacson said the exchange rate had risen to P53.40 to $1, or P6 more than the previous rate of P47.03.
He said this would impact on the country’s payment of $73 billion in foreign debt because of the additional P446 billion generated by the peso’s fall.
“So isn’t a weak peso bad for the economy?” Lacson said, noting that the country also imported raw materials that now cost more, thus a weak peso was “bad for the economy.”
Opposition Sen. Bam Aquino said the government should suspend the TRAIN law that took effect in January, as he noted that the inflation rate had doubled in one year.
“The message is clear on the 5.2-percent inflation rate. We need to stop TRAIN immediately because people are drowning from the high prices of commodities,” Aquino said in a statement.
Suspend TRAIN law
Aquino has filed a bill proposing the suspension of the TRAIN law and raising the ceiling for tax-exempt income but imposing higher taxes on oil and other products.
Sen. Joel Villanueva sought the lowering of the 12-percent value-added tax to 10 percent and the repeal of “unnecessary and inefficient VAT exemptions.”
In a statement, Villanueva also said the government needed to work to liberalize the importation of rice in the country.
“We reiterate our call to the government to check and find efficient means of managing inflation through sound economic policies,” he said.