VAT on diesel up by almost 50% from Jan, Bayan claims

MANILA, Philippines - With the latest round of fuel price hikes this weekend, the value-added tax (VAT) on diesel has gone up by almost 50 percent compared to January, a militant group said Saturday. The Bagong Alyansang Makabayan's Kontra KulimVAT said the VAT on diesel is now P6.71 per liter, a 45% hike from P4.61 per liter in January. It added the VAT on liquefied petroleum gas (LPG) now stands at P88.62 per 11-kg tank, compared to P72.35 per tank in January. "This means that in less than seven months, the national government's VAT collections from two of the most socially sensitive petroleum products have increased by P2.10 per liter on diesel and P16.27 per tank on LPG," it said. Kontra-KulimVAT added that in January, the government was collecting around P81.27 million everyday from the VAT on diesel and P18.62 million daily from LPG. With the latest increases in prices, the government will now collect P118.29 million everyday from the VAT on diesel and P22.77 million on LPG. "But such huge increases in government revenues also directly translate to more economic hardships for ordinary people," said spokesman Arnold Padilla. He said jeep drivers, for instance, shell out P138.80 per daily trip to pay for the VAT on diesel last January. "Today, they will need to spend P201.30, or an additional P63", Padilla pointed out. There are more than 426,000 jeepney drivers in the country, he said. Meanwhile, some 8.6 million households nationwide will now spend P66.46 per month to pay for the VAT on LPG, compared to P54.26 last January, based on Kontra-KulimVAT estimates. "The Arroyo administration could no longer justify the VAT on oil with the unabated fuel price hikes. Its desperate attempts to counter the snowballing call to cancel this oppressive tax through the gasoline price rollback and subsidies will not appease the restless public," said Padilla. Kontra-KulimVAT also said that the VAT on oil was conceived to assuage the fears of foreign creditors of debt default and not to raise money for social services. "Arroyo and her economic managers are just forced to give good reason for the continued imposition of the VAT on oil, that's why they hype the subsidies from VAT. But the more it defends the VAT amidst the worsening poverty and escalating prices, the more the government becomes despised by the people," Padilla said. - GMANews.TV