Drilon wary of raising fuel taxes, tax on sugary drinks

MANILA, Philippines — The Senate must study a government proposal to raise taxes on fuel and on sugary drinks as part of the administration's tax reform package, Senate Minority Leader Franklin Drilon said Sunday.

In a radio interview on radio dzBB, Drilon said the proposed incremental increase on the tax on fuel products and a similarly gradual imposition of a tax on diesel could lead to higher prices and fares.

"Yung diesel po ang ginagamit ng pampasaherong sasakyan; yung mga mangingisda, diesel; yung tricycle driver, diesel," he said.

Under the proposal, the tax on diesel will be gradually raised to P6 per liter by 2020.

Drilon also said that the proposed tax on sugar-sweetened drinks at P10 per liter might disadvantage poor Filipinos who consume items like 3-in-1 instant coffee.

He said that while the Senate minority bloc recognizes the need to revisit the country's tax rates, lawmakers should also look into the administrative aspect of taxation like collection.

"Yung tinatawag nating administrative devices kung paano po mapapataas ang collection without increasing the rates. Iyan po ang ating objective," he said.

He said the government can also work on raising collections by plugging what he called leakages in tax collection.

The administration has argued that the higher taxes are needed to pay for infrastructure projects that will include railways in Luzon and Mindanao.

The proposed tax reform bill also reduces personal income tax for millions of workers.

Under adjusted rates, workers with smaller incomes will pay less taxes, while those earning millions will be taxed 35 percent, up from 32 percent.

The House of Representatives has passed its version of the tax reform bill and President Rodrigo Duterte asked the Senate during his State of the Nation Address to pass their counterpart bill.

Money from taxes will also be used for social support like cash transfer programs for the poor and for drivers of public utility vehicles.

Drilon said the Senate cannot just pass the administration's proposed legislation "hook, line and sinker."