Senators, labor groups question VAT on toll, mass transit fare hikes

Senators and labor groups on Tuesday questioned the need for the immediate imposition of VAT on toll and fare hikes of mass rail transit systems in Metro Manila. "Before doing the rate increase patunayan muna ninyo na okay ang serbisyo ninyo," Sen. Ralph Recto, chair of the Senate ways and means committee, said during Tuesday's hearing on toll and fare hike. Senator Manuel Villar, chair of the Senate trade and commerce and economic affairs committees, likewise said that there should be no need to increase the government's revenue from toll and mass transit because the state hasn't been spending its budget for 2011. "Kung underspending ang problem bakit tayo magtataas ng presyo? Di tayo gumagasta kasi walang pagdadalhan," he said during the same hearing. He added that the government should consider the effects of the fee increases on commuters and the people in general. "When you pay taxes, you expect to be given something in return," he said. Every day, around 500,000 commuters take the MRT (North Ave. in Quezon City to Taft Avenue Extension in Pasay City) while the LRT Line 1 has over half a million commuters and LRT Line 2 is used by 250,000 people. Based on the new rates, the P20 fare for LRT line 1 from Roosevelt Avenue in Quezon City to Baclaran in Parañaque City will be increased to P30, while the P15 fare in LRT line 2 from Marikina City to Legarda in Manila will be raised to P25. During the hearing, the Kilusang Mayo Uno (UNO) and the Confederation for the Unity, Recognition, and Advancement of Government Employees (Courage) said workers will not be able to afford the higher commuter fares. "Filipino workers have not had a significant wage increase... What we have been having are meager increases," said KMU chairperson Elmer Labog. Ferdinand Gaite, national president of Courage, added that many workers have salaries which fall below the poverty level. He said that even some government employees like them have salaries below the current cost of living. Impact on wage earners National Economic Development Authotity director-general Cayetano Paderanga Jr. said that the proposed fare hike in the mass transit system could result in a 0.22-percent increase in overall consumer prices. "It must be noted that the inflation impact on households closer to the area will be higher than what the national model implies," he said. The good news, he said, is that the Department of Transportation and Communications estimates the higher fares may reduce the subsidy from the national government by about P2.3 billion. "The freed up resources could be allocated by the government for additional spending on other items in the budget like expenditure for social services and infrastructure development which of course could benefit Filipinos even outside of Metro Manila, not only limited to mostly working class commuters of MRT-LRT1-LRT2," he said. Finance Assistant Sec. Emilia Cruz also said the Finance Department supports the fare increases because the state primarily shoulders the maintenance of mass transit systems. Trade Consumer Welfare Undersecretary Zenaida Maglaya, however, assured the public that the fare increases will have "minimal effect" on the price of vegetables and sardines, which are transported to different parts of the country. "Maliit lang po ito," she said during the same hearing. But Villar said the Department of Trade and Industry (DTI) should try consulting with minimum wage earners. "Tingnan (ninyo ang) epekto sa mimimum wage earner. Ano naman ang impact sa kanya ng increases na ito?," Villar said. Paderanga, meanwhile, assured the public that they haven't approved any proposal from any government agency to increase their fees for certain state services. — VS, GMA News