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By Efren L. Danao Senior
Reporter
A number of senators belittled
the 1-percent cut in the tariff on oil ordered by President Gloria
Arroyo, saying it would barely have an impact on consumers.
Among them were Senators Mar
Roxas 2nd, Francis Escudero, Panfilo Lacson and even
pro-administration lawmaker Miguel Zubiri.
Sen. Loren Legarda, meanwhile,
called for the urgent adoption of alternative sources of energy as a
long-term solution to the skyrocketing oil prices, as she described
the oil tariff reduction as a mere stop-gap measure.
Referring to the tariff cut,
Roxas said, “That is not enough, inadequate, tokenism.”
Finance Secretary Margarito Teves
had estimated that the lower tariff would lower fuel prices by 50
centavos a liter and that the government would forgo P11 billion in
revenues.
Roxas said the reduction is a
good start when Congress is not in session, but he contended that a
better alternative is to exempt petroleum products from the expanded
value-added tax law.
Without the 12-percent VAT, oil
prices would go down by P4 a liter and an 11-kilo liquefied
petroleum gas (LPG) tank, by more than P60, he explained.
Teves has rejected Roxas’ bill
seeking to suspend and then eliminate the EVAT on petroleum
products. He said the loss in government revenues would be
substantial, some say P60 billion. While he conceded that the
government might later recapture the revenues when consumers have
more money to spend, Teves argued that this would take quite a long
while.
Seconded by colleagues
Zubiri and Escudero, the chairman
of the Senate Committee on Ways and Means, supported Roxas on the
exemption of petroleum products from VAT.
Escudero criticized the President
for declaring that the 12-percent VAT on oil would stay.
“Because Mrs. Aroyo had dug her
trenches on the VAT issue, she should have wiped out the whole
3-percent tariff on oil,” he said.
For her part, Legarda said, “We
must come up with long-term solutions because the clock is ticking
on not only the country’s, but the entire world’s dependence on
oil.”
Legarda, chairman of the Senate
Committee on Economic Affairs, has filed bills seeking the
development and use of alternative and renewable energy to end the
country’s dependence on imported nonrenewable and costly fossil
fuel. Scientists have estimated that the worldwide supply of oil may
only last from 50 to 100 years depending on how nations use it.
Meanwhile, Lacson proposed a
program to distribute fuel discount coupons to public utility
drivers only, so that the maximum effect of the tariff cut on oil
products will benefit only those who need it most.
He called on the Philippine
National Police leadership to intensify efforts to curb and
extortion activities that victimize lowly drivers and transport
operators.
In GMA’s defense
Roxas is merely politicking for
insisting the scrapping of the 12-percent value-added tax on
petroleum products, Environment Secretary Lito Atienza said
Wednesday.
Atienza, who is defending the
Arroyo administration’s position to retain the 12-percent VAT on
petroleum products, said the public must scrutinize Roxas’ motive
for proposing the removal of tax on fuel.
“He knows very well that that
is not the solution,” Atienza said. “But he has to say it over
and over again because he is already on the campaign trail.”
Trade Secretary Peter Favila said
scrapping the VAT on petroleum products would result to P60 billion
forgone revenues for the government.
Quantify measures
The government should quantify
the impact of the tariff cut on imported oil in order to make clear
message on how it will impact to the government finances and
consumer expenditures, said Solita Monsod, professor at the
University of the Philippines School of Economics and former chief
of the National Economic and Development Authority (NEDA).
“There should be meaningful
measures from the government, and [it] should quantify the impact if
the reduction would be meaningful enough,” Monsod told The Manila
Times.
Another thing the government can
do is to curb oil smuggling, she added.
“Stopping the smuggling will
reduce revenue loss of government,” Monsod explained.
“Equivalently it will allow government to have a larger tariff
reduction for the same amount of lost revenue.”
Earlier, the Bureau of Customs
reported that government loses at least P5 billion a year in duties
and taxes on oil smuggling. Petroleum accounts for 13 percent to 15
percent of the bureau’s total revenue collection.
In the coming energy summit,
Monsod said government should relay a clear message the impact of
the reduction of imported oil price President Arroyo will
convene an energy summit later in January to consult people on how
to soften the impact of rising oil prices.
--With Angelo S. Samonte, Maricel E. Burgonio, Darwin G. Amojelar
And Sammy Martin
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