Senators warn P6 tax on fuel inflationary

The government proposal to impose excise taxes on fuel could lead to price increases that would burden poor Filipinos, two senators said on Sunday.

Sen. Sonny Angara, chair of the Senate ways and means committee, said the Department of Social Welfare and Development (DSWD) was against the P6 excise tax on fuel under the administration’s proposed tax reform program because that would mean an additional P10 daily expense for poor families.

Increase in inflation

Senate Minority Leader Franklin Drilon said imposing the excise tax on fuel would lead to a 1.5-percent increase in inflation.

“A DSWD official came [to the Senate hearing] and opposed this proposal because, first of all, it is too high and the expenses of an ordinary family or a poor family could go up by P10,” Angara said in a radio interview. “That is why it’s called inflationary.”

He said the Department of Finance recognized this and countered that the government would pour in P300,000 a month to the conditional cash transfer program to help affected poor Filipinos.

“But the DSWD undersecretary … said they might have a problem with distributing that because as many as 20 million would be hit by the excise tax on fuel,” he said.