MANILA – Beneficiaries of the government’s Pantawid Pasada program may not receive an increase in 2019 if the second hike in oil excise taxes under the Tax Reform for Acceleration and Inclusion (TRAIN) is suspended next year.
In a briefing Wednesday, Budget Secretary Benjamin Diokno said the amount of the cash transfer is derived from the hike in the excise tax. “It will be based on existing tariff. If we don’t implement the second phase of the tariff then the adjustment will also be in abeyance,” Diokno said.
Under the TRAIN law, the increase in the excise tax on oil for 2019 is PHP2 per liter for both diesel and gasoline.
The suspension is being proposed since global oil prices have risen to more than USD80 per barrel. Under TRAIN, the excise tax increase for 2019 may be suspended if the average price of oil in the international market averages USD80 per barrel in the last three months of this year.
Under this law, provisions under the Pantawid Pasada program, which will be given to jeepney drivers and operators, amount to PHP977 million this year and PHP3.2 billion for 2019.
Diokno said the proposal is just a back-up plan since “we’re not sure if there is a cut.” He, however, said “if there is a deduction in our programmed revenues, then we will calibrate our expenses.”
Economic managers on Tuesday announced a plan to set up a task force that will study which programs proposed under the 2019 budget would be postponed or cancelled as a result of the possible suspension of the second tranche of the oil excise tax hike, which is projected to bring in some PHP41 billion in revenues.
Diokno said expenditures “will not be cut right away” since the task force will study the options and make recommendations before the end of the year. “We will protect, as much as possible, the infrastructure program of the government,” he said, adding that investments in human capital such as education, health, and social welfare will also be prioritized. (PNA)
