Revised TRAIN up to Congress – Duterte

MANILA, Philippines — President Duterte is leaving it up to Congress to decide whether to amend the Tax Reform for Acceleration and Inclusion (TRAIN) law, which some sectors blame for the rising prices of basic goods.

Duterte said he could not tell Congress what to do with the TRAIN law, noting that the measure was enacted by the legislature.

“The law was enacted by Congress. I’ll leave it to Congress to decide whether or not to amend or suspend or modify the law. I’ll leave it to Congress. There’s no value in giving (them) what I want,” the President said in a press conference at the Ninoy Aquino International Airport Terminal 2 early yesterday.

“If I tell them we need it for the Build, Build, Build and (they say otherwise), I can’t do anything. If they say ‘well, we’ll just have to bite the bullet and go on, I also cannot do anything if that’s their decision,” he added.

Signed by Duterte in December 2017, the TRAIN law has reduced the income tax but imposed new taxes on diesel, liquefied petroleum gas, kerosene and bunker fuel for electricity generation and higher taxes on other oil products.

The Department of Finance pushed for the measure to fund key government projects, including the P8.4-trillion Build, Build, Build infrastructure program.

Some groups said the higher fuel tax was burdensome to consumers because it jacked up the prices of goods.

Finance officials, however, claimed that TRAIN had little effect on commodity prices and insisted that the price adjustments were caused mainly by the spike in rice prices, a weak peso and rising oil prices abroad.

Some senators have called for the suspension of the fuel tax provisions to provide relief to consumers. The law, however, states that the provision on fuel excise tax may only be suspended in the next tranche of increase in the prices of oil, which will happen in January 2019.

This means that even if global oil prices average $80 per barrel – the threshold stated in the law – consumers cannot expect a suspension of the fuel tax provisions this year unless the TRAIN is amended.

Duterte said the Philippines is experiencing difficulties because it does not have enough oil sources.

“Indonesia has it. Malaysia has it. Brunei has it. We were at the mercy of the oil-producing nations. And sometime in 1972, there was this reduction of supply...Pag tumaas ang oil, talagang maghahabol tayo (If oil prices increase, we would really experience difficulties),” the President said.

“We are having difficulties because we have to import oil. We do not have a supply of that,” he added.

Duterte maintained that the Philippines is having difficulties because of rising oil prices and not because it is “doing bad in business.”

“We are doing fine...The problem is I said, we have to buy oil to run everything, including to reach where you want to work. If you have to ride, it’s eating oil. That machine is a product of oil in the factories. Powered by oil,” the President said.

“Maybe some problems here, there, but we are in a hurry in our infrastructure. But always the rate of speed with which we will produce or finish them is really dependent on one vital commodity that we do not have. It’s oil,” he added.

Related video: