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Philippines – Diokno: Suspending TRAIN law will ‘do more harm than good’
MANILA, Philippines — Freezing the implementation of the Tax Reform for Acceleration and Inclusion Act could be more harmful than helpful, as it could disrupt the government’s revenue targets, the country’s Budget chief said Wednesday.
“Suspending the law is to me out of the question. It has to be implemented,” Budget Secretary Benjamin Diokno said in a press conference. “Suspending the law would do more harm than good.”
President Rodrigo Duterte has thrown his weight behind the TRAIN law, which aims to help fund his administration’s ambitious infrastructure program.
However, the TRAIN law—which lowers personal income taxes while raising excise levies on fuel and cigarettes, among others—has been blamed for the recent jump in prices of widely used goods and services, with some lawmakers saying that Congress might “suspend” the TRAIN law if inflation becomes unmanageable.
But Diokno said temporarily preventing the TRAIN law’s implementation could “upset” the government’s revenue projections and tax collection efforts.
“It will create a lot of chaos because the Bureau of Internal Revenue and Bureau of Customs are already geared towards collecting these taxes,” the Budget chief said.
A March 2018 survey by pollster Pulse Asia found that rising prices of key consumer items is the second “money-related” concern of Filipinos that the government must immediately address.
According to Diokno, the TRAIN law has provided “mitigating measures” to shield the poor from the sting of higher consumer prices stoked by the new tax law.
“We admit there might be some transitory increases in prices as a result of the TRAIN law,” he remarked.
Using 2012 as base year, inflation in April accelerated to a five-year high of 4.5 percent, putting the year-to-date tally to 4.1 percent to breach the Bangko Sentral ng Pilipinas’ 2-4 percent target range.
Source: https://www.philstar.com/business/2018/05/09/1813657/diokno-suspending-train-law-will-do-more-harm-good#JBLUm0Y1fWSVGORg.99