The Department of Trade and Industry (DTI) wants to reassure the public that it is working to ensure the government’s new tax reform program will benefit the Filipino people while minimizing any negative effects.
DTI being the lead agency of the National Price Coordinating Council is closely monitoring the correct implementation of the Tax Reform Acceleration and Inclusion (TRAIN) Program together with the private sector and stakeholders.
The government foresees a minimal impact on inflation. Based on the model, any impact on the inflation will be around 0.7%, or less than 1%. While excise tax rates on fuel would affect the transportation cost of manufacturers, this would account for less than 5% of the total production cost.
The new program will not have any impact yet on current gas prices as gas stations are still carrying inventories of the old costing without the excise tax. As such, any recent increase may be attributed to the usual ups and downs of the world oil prices.
The minimal impact should not alter the Suggested Retail Prices (SRPs) of products and services. “For most consumer products, we don’t expect
any adjustments in SRP- but we are closely monitoring the market, “says Trade Secretary Ramon Lopez.
The agency also foresees that any changes in the price of basic raw materials- if and when they will happen- will have an impact on product pricing.
In the event that manufacturers raises the SRP of basic goods and prime commodities, there must be a justifiable reason for the increase.
DTI is watching out for hoarders and profiteers in the market, closely monitoring any price change to ensure prices are still below the SRP. Violators may be penalized from Php 20, 000.00 to Php 1M. The department is calling on all manufacturers and retailers not to increase their prices outside the parameter of the new tax reform program.
Despite criticisms, the Trade Secretary reiterates that the government is closely monitoring the effects of the program.
“Ultimately, we are confident that the benefits of this program will certainly redound to the Filipino people for greater inclusive growth and shared prosperity for all.” Trade Secretary Ramon Lopez.
By Anthea Aivi Borbon