Government urged to roll out aid for poor households

As concerns rise on the increasing consumer prices partly blamed to the TRAIN law, a tax expert has called on the government and the private sector to help those most affected including the poorest of the poor and minimum wage earners.

Tax reform advocate Raymond Abrea said delaying the subsidy, which the government promises to provide under the Tax Reform for Acceleration and Inclusion (TRAIN) law, will hurt the poor even more, as life is already difficult for them even without the new tax measure.

Abrea asserted that private firms are also "morally responsible for the welfare of their employees and their families."

"While the government is subsidizing the poorest of the poor, businesses must extend financial assistance to its employees especially to the minimum wage earners," he said.

The tax law, he noted, provides for non-taxable de minimis benefits such as rice subsidy, and laundry allowance, among others; and taxexempt incentives which will help employees to be more productive.

Abrea urges the Department of Social Welfare and Development to release unconditional cash transfer (UCT) of P2,400 to 10 million poorest households as it is part of the social mitigating measures to protect the poor.

"There is no acceptable reason for the delay as the new taxes were imposed last January 1, 2018 and prices increased immediately on the first month of its implementation," said Abrea, president of Asian Consulting Group.

"As a tax advocate, I feel equally responsible as I supported the TRAIN law, the Comprehensive Tax Reform Package (CTRP) of the government," he added.

Aside from UCT, fuel vouchers should also be given to qualified franchise holders of public utility jeepneys (PUJs) which will compensate the increase in excise taxes of petroleum products.

For minimum wage earners, unemployed and the poorest 50 percent of the population, they should be receiving a 10 percent fare discount from all public utility vehicles (PUVs), discounted purchase of NFA rice from accredited retails stores (10 percent of the net retail prices, up to a maximum of 20 kilos per month), and free skills and training under a program in Technical Education and Skills Development Authority (TESDA), he further explained.

Earlier, some senators and various sectors had called on the government to suspend implementation of TRAIN as inflation continues to rise.

The Department of Finance (DOF) was quick to explain and defend TRAIN not to be blamed for the 4.5 percent inflation in April.

The DOF clarified that TRAIN accounted for only 0.4 percentage points of the 4.5 percent. According to DOF, inflation rose mainly because of local and global factors such as the rise in global oil prices, weak peso, and rice shortage, among others.

For its part, the Department of Trade and Industry (DTI) confirmed impact of excise tax on oil and petroleum products, sugar and tobacco on prices of other goods, but noted it's minimal.

"But the issue on inflation should not come as a surprise, as it was debated during the deliberation of TRAIN in the Senate and the government assured our legislators of 2-4 percent inflation only, not 4.5 percent," Abrea said.