MANILA, Philippines—Malacañang on Saturday challenged lawmakers calling for the suspension of the 12-percent value-added tax (VAT) on oil to file the necessary bill to lower the consumption tax on petroleum products if they deem the 12-percent rate too high and burdensome to consumers.
Undersecretary Abigail Valte, President Aquino’s deputy spokesperson, said that lowering the VAT on oil altogether doing away with it would have an adverse effect on the government’s budget for basic services and other programs for the public.
“If they really feel strongly that 12 percent is too high, or they think that there should be a suspension, then the best place to start would be Congress or the Senate,” Valte said over state-run radio dzRB.
But a militant organization, saying that Valte did not know what she was talking about, disclosed that several bills had already been filed calling for a review or repeal of the VAT measure but were collecting dust in Congress.
“You cannot just remove the VAT on oil and act as if it was in a vacuum,” she said, in justifying the government’s continued collection of the 12-percent tax despite the continuous increase in the prices of petroleum products.
Valte said that if a funding source were removed, certain government programs would lose their funding. “It’s not as if we decide to remove it and that is already the end of the line,” Valte said.
Reacting to Valte’s remarks, the militant Bagong Alyansang Makabayan said legislation was pending in Congress seeking the removal of the VAT on oil products.
“Ms Valte appears clueless to the fact that there are pending bills on the VAT on oil and even the Oil Deregulation Law now gathering dust in Congress,” said Bayan secretary general Renato Reyes Jr. in a statement.
“The problem is not the lack of legislation but the utter lack of political will and sense of urgency on the part of the Aquino government,” he said.
Bayan’s allied party-list group Bayan Muna has filed House Bill No. 2719 calling for the repeal of the VAT on oil.
Reyes said there were at least six pending bills related to the review and repeal of the Oil Deregulation Law filed before the House committee on energy but not a single hearing had been set.
The committee is chaired by Liberal Party lawmaker Batanes Rep. Dina Abad, wife of Budget Secretary Florencio Abad and an ally of Mr. Aquino.