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By Maricel E. Burgonio, Reporter
THE Bangko Sentral ng Pilipinas (BSP) said a new
tax relief measure for individuals and corporations is unlikely to
cause a spike in the prices of goods and services.
BSP Governor Amando Tetangco Jr. said Republic
Act 9504 is expected to be revenue neutral and would have minimal
impact in inflation.
President Gloria Arroyo signed the measure into
law on June 17. The new law exempts minimum wage earners from income
taxes, resulting in P14.25 billion in foregone revenues for the
government.
R.A. 9504 increases the level of personal
exemption allowance of each individual taxpayer to a uniform amount
of P50,000 regardless of the status of the taxpayer. It also raises
the additional exemption allowance for each qualified dependent from
P8,000 to P25,000.
With the income tax exemption of minimum wage
earners, they would have more purchasing power.
The BSP forecast inflation to reach 7 percent to
9 percent this year driven by higher global oil and commodity
prices.
Inflation hit a 14-year high of 11.4 percent in
June. Acting Socioeconomic Planning Secretary Augusto Santos said
the first-half inflation already stands at 7.6 percent, or within
the BSP’s full-year forecast.
The BSP expects inflation to normalize next
year, as the demand pressure is likely to moderate, supported
partially by the central bank’s tighter monetary policy.
It said inflation would begin to decelerate in
the fourth quarter of the year through 2009.
Before easing, price increases however would
peak in the third quarter of the year, it added.
Victor Abola, economics professor at the
University of Asia and the Pacific, however, said inflation would
hit the double-digit mark until October.
“This month, inflation may grow double digit,
but higher than last month,” he said.
-- With Darwin G. Amojelar
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