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House, Senate bills filed seeking to amend TRAIN

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Senator Bam Aquino
Senator Paolo Benigno 'Bam' Aquino — SENATE PRIB

By Camille A. Aguinaldo
and Charmaine A. Tadalan

SENATOR PAOLO Benigno A. Aquino IV on Thursday filed a bill amending Republic Act No. 10963 or the Tax Reform for Acceleration and Inclusion (TRAIN) law which would impose an automatic suspension of excise taxes on fuel when the inflation rate exceeds the target set by the government.

At the House of Representatives, the Makabayan bloc on Thursday said it has filed a bill seeking to repeal certain provisions of the TRAIN law.

Senate Bill No. 1798 states that excise taxes on fuel under TRAIN will automatically be suspended when the average inflation rate surpasses the annual inflation target set by the Development Budget Coordination Committee (DBCC) and the Bangko Sentral ng Pilipinas (BSP) over a three-month period.

The bill also indicated that excise taxes on fuel prior to the effectivity of the tax reform law shall remain in force during the period of suspension.

If the inflation rate returns to the government’s target, the Department of Finance (DoF) may lift the suspension and reimpose the excise taxes based on its rate at the time of suspension.

Under the present tax reform law, excise taxes on fuel would be suspended if the average Dubai crude oil price for three months prior to the scheduled increase reaches or exceeds $80 per barrel.

TRAIN imposed an increase in tax on gasoline and diesel to P7 per liter and P2.50 per liter, respectively

In his explanatory note, Mr. Aquino said the bill seeks to protect “underprivileged Filipino families” from rising prices of fuel and their effect on the prices of goods and services.

“While we have little control over global fuel prices, the imposition of excise taxes is in our hands. It is our responsibility to be flexible and responsive when the weight of inflation becomes too heavy for the poor Filipino families to bear,” Mr. Aquino said.

House Bill (HB) 7653, on the other hand, aims to repeal “regressive taxes including the expansion of VAT coverage, additional excise taxes on petroleum products and the excise taxes on sugar-sweetened beverages,” as stated in the bill’s explanatory note.

The bill proposes to repeal Section 47 on the said beverages and Section 82 on appropriations to the government’s infrastructure and social programs.

Also included in the bill are provisions restoring personal tax exemption worth P50,000 for individual taxpayers and an additional exemption of P25,000 for dependents not exceeding four.

Value Added Tax (VAT) exemptions on electricity will also be restored, as well as the 3% tax exemption for cooperatives, self-employed, and professionals with gross receipts of P2 million and below.

“This bill should not be seen as a hindrance by the administration and taken as a means to assuage the suffering of our poor countrymen. We hope that this bill will be fast-tracked by Congress because the economic suffering being endured by our countrymen (caused by) the TRAIN law is very real and should be addressed (at) the soonest time possible,” Bayan Muna Rep. Carlos Isagani T. Zarate said.