Lifting of Oil VAT to Benefit Millions — Bayan

Umbrella group Bagong Alyansang Makabayan (Bayan) said that lifting the 12 percent value added tax (VAT) on petroleum products will immediately and directly translate to concrete benefits for the poor. Bayan and the independent think-tank Ibon Foundation made separate powerpoint presentations before the joint hearing of the Senate Ways and Means and Energy Committees last January 23.

Bayan estimated that cancelling the oil VAT will increase the income of jeepney drivers by around P123 per day or around 1/3 of a driver’s daily income. The move will benefit 426,572 jeepney drivers nationwide and their families, or a total of around 2.1 to 2.6 million people.
The number of jeepney drivers was estimated based on existing Department of Transportation and Communication (DOTC) data on the number of registered public utility jeeps as of 2007.

Similarly, oil VAT suspension, according to Bayan, will improve the income of around 581,578 tricycle drivers in the country by about P19 daily, with the total number of people directly benefiting pegged at 2.9 to 3.5 million, representing the tricycle drivers’ families. The number of tricycle drivers were also derived from DOTC data on registered tricycle units as of 2007.

Meanwhile, lifting the oil VAT will bring down household spending on LPG by P59 per 11-kg tank or around P169 per month. About 8.6 million households, representing around 43.1 to 51.7 million people, are expected to directly benefit from this, Bayan said.

In the provinces and some urban poor communities, household spending on kerosene (for lighting and fire starting/cooking) is expected to go down by about P20 a month, and will benefit 9.4 million households or around 47 to 56.4 million individuals. The number of households using LPG and kerosene were taken from the latest National Statistics Office energy consumption survey.

Bayan also cited data from the fisherfolk group Pamalakaya which says that there are about 177,000 motorized bancas nationwide. The VAT removal could result in savings of P25-P50 per banca a day. There are an estimated 700,000 fisherfolk using motorized bancas.

“It is not true that the VAT removal will only benefit the rich consumers. Data will show that the VAT removal will result in concrete effects for many poor consumers. Various government agencies have so far failed to debunk this conclusion,” Reyes said.

Bayan said that it is supporting current Senate initiatives to cancel the oil VAT because it is an urgent measure that could provide respite to people battered by ever increasing cost of living, low wages and income, and job scarcity. The militant group and its member organizations nationwide are now throwing their support behind bills filed by Senator Mar Roxas and Sen. Juan Miguel Zubiri.

Bayan Secretary general Renato Reyes, Jr and Ibon Head of Research Sonny Africa made the presentations on impacts on consumers and impacts on the economy. Also attending the hearing were representatives of transport group PISTON, labor group Kilusang Mayo Uno and the People’s Unity Against Oil Price Hike. ###

IMPORTANT NOTICE: INBOX is an archive of press releases, statements, announcements, letters to the editors, and manifestos sent to PinoyPress for publication. Please email your materials to pinoypress @ gmail.com. PinoyPress is not responsible for the content of these materials. The opinion expessed in these items does not reflect those of PinoyPress and its staff. Please refer to our terms of use/disclaimer.