Lower inflation not felt by poor, middle class — lawmaker

MANILA, Philippines — The poor and the middle class do not feel the lower inflation rate reported by the government this week, Rep. Carlos Zarate of Bayan Muna said yesterday.

On the contrary, people are still reeling from the continued increase in prices of products and services that started in January as a result of new and higher fuel taxes imposed under the Tax Reform for Acceleration and Inclusion (TRAIN) law, he said.

He said the reported lower inflation rate of 3.3 percent meant only that price increases were smaller compared to those in previous months.          

“The deceleration does not mean that prices of goods are now going down. The rate of price increases now may have been slowing down, but the sad fact is the prices of goods are still spiking, on top of the increases registered last year, when inflation peaked at 6.7 percent, the highest in the last 10 years,” he added.

Zarate pointed out that people still have to bear price hikes resulting from new and higher fuel taxes “because these levies are still there and have not been suspended as repeatedly promised by President Duterte and his economic managers.”

“Only a suspension and eventual scrapping of these taxes will bring consumer prices down,” he stressed.

There are proposals pending in the House of Representatives that seek to either suspend or junk fuel taxes under the TRAIN law, but leaders of the chamber are opposed to them.

The levies increased this year by P1 to P2 per liter, and are set to go up again next year. 

Another congressman, Michael Romero of party-list group 1-Pacman, said food prices account for the lower 3.3-percent inflation.

“Prices of food products should further go down. The price of rice in particular should decrease when the government starts to implement the law replacing volume restrictions on rice importation with tariff,” he said.

He said farmers would benefit in terms of credit and other forms of assistance from the P10-billion rice competitiveness enhance fund the government is mandate to set up using tariff collections.