PIA Press Release
2005/08/17
NG working to minimize impact of oil price hike - Teves
Quezon City (17 August) -- The national government has developed several measures to cushion the impact of escalating oil prices and the Reformed VAT Law on the general public, said Gary B. Teves, Secretary of Finance.
Measures incorporated into the Reformed VAT Law include:
- Removing the excise tax on diesel, kerosene and bunker fuel oil.
- Zero-rating the sale of power by geothermal, hydro, and solar energy plants.
According to Teves, an executive order reducing the import tariff on petroleum from 5% to 3% (except for LPG, which will remain at zero) will also immediately take effect upon implementation of the Reformed VAT Law.
Teves also outlined the initiatives undertaken by the other Departments to keep prices at reasonable levels:
- Department of Trade and Industry
- Minimize irregular price movements by closely monitoring wet and super markets
- Work with LGUs to activate local price coordinating councils (LPCCs)
- Hold dialogues with various manufacturing and industry associations to persuade them to keep prices steady for as long as possible.
- Department of Energy
- Implement Organized Bus Route Program
- Implement Alternative Fuels Programs, e.g., coco-biodiesel, fuel ethanol, natural gas and LPG for transport
- Discuss with ERC the possibility of expanding lifeline rates
"While we recognize that the effects of high oil prices and the EVAT are painful, allowing the fiscal position to further deteriorate and adversely affect the investment climate and exchange rate will cause more hardship in the long-term," Teves said.
"We need the VAT Reform Law if we want to be able to make a significant reduction in our deficit and consequently, provide the social services and infrastructure that our people and our country sorely need." (DOF) [top]
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