Salceda: Marcos wants House to study removing VAT on utilities

President Ferdinand “Bongbong” Marcos Jr. wants the House ways and means committee to look into the feasibility of removing value-added tax on public utilities, Albay Representative Joey Salceda said Thursday.

Salceda, ways and means panel chairman, made the statement after House Deputy Minority Leader France Castro of ACT Teachers party-list, House Assistant Minority Leader Arlene Brosas of Gabriela party-list and Raoul Manuel of Kabataan party-list refiled measures seeking to remove VAT on electricity bills,  toll fees, and water bills to alleviate the plight of the public amid continued increase in prices of basic goods and services.

“Pinatignan po nila sa akin kung puwedeng tanggalan ng VAT ang public utilities, lalong lalo na ang kuryente (They asked me to look into the possible removal of VAT on public utilities, especially on electricity),” he said in an online press conference.

“Definitely, may ganun na instruction ang Presidente (there is such an instruction from the President),” Salceda added.

The inflation — the rate of increase in the prices of consumer goods and services — jumped to 7.7% in October from 6.9% in September according to the Philippine Statistics Authority (PSA) last October 3. The 7.7% inflation rate is the highest in 14 years, also according to PSA.

Salceda, however, conceded that hammering out such measures is easier said than done because of its huge impact in raising government revenues.

For one, the lawmaker said the VAT on water bills could be removed, provided that the franchise tax for water concessionaires is increased.

Salceda said that the National Internal Revenue Code needs to be amended so that the increase in franchise tax won’t be passed on to consumers.

“We will study it very carefully. Kasi kung gagawin namin ‘yan at makikinabang ang tao ngayon, pero mada-downgrade ang credit rating natin, lalong tataas ang interest rate, mas lalong maapektuhan ang mahihirap kung walang panggastos ang gobyerno sa social services,” Salceda said.

(If we do that now and we reap the benefits only to have a downgraded credit rating, we will just increase interest rate, the poor will be greatly affected if the government does not have enough resources to spend for social services.)

“Definitely, we in the House ways and means panel will avoid revenue negative measures and avoid credit downgrade arising from increased [budget] deficit and higher that. We are very conscious of that, maingat na maingat po tayo riyan (We will be treading very carefully),” he added.

For her part, Castro said removing VAT on electricity, toll fees, and water bills should have been passed a long time ago.

"We refiled House Bill 5994 or the bill removing value added tax (VAT) on systems loss in electricity, House Bill 5995 removing VAT on electricity bills, House Bill 5996 removing VAT on toll fees, and House Bill 5997 removing VAT on water bills, as concrete steps in alleviating the plight of Filipino consumers and lowering their bills," Castro said in a statement.

Castro said that simply removing the 12% VAT from a P2,000 electricity bill would save the consumer P240 of his hard-earned money.

"These bills were first filed by Bayan Muna in the previous Congresses, but we believe that the approval of these anti-VAT bills is more imperative now because of the dire hardships that Filipinos are enduring. We urge the House leadership to immediately hear these bills, and Malacañang should also classify them as urgent as a way to help our people," she added.

Certifying a bill as urgent allows the House of Representatives and the Senate to approve the measure on second and third reading on the same day. —AOL/VBL, GMA Integrated News