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Bacolod City, Philippines Thursday, December 6, 2018
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VAT not causing inflation: VG


Negros Occidental Vice Governor Eugenio Jose Lacson disagrees with the proposal of senatorial aspirant Imee Marcos to temporarily suspend the implementation of Value Added Tax on basic commodities and fuel for one year to address the recent inflationary measures.

VAT has already been there even before the imposition of excise tax, Lacson said, as he also noted that the country is now experiencing low inflation.

So I don’t think VAT is the cause of inflation, he said.

Marcos said that the suspension of VAT for one year, instead of implementing a fresh increase in excise taxes on fuel by January next year, will provide immediate relief to Filipino consumers.

Lacson said he opposes the removal of VAT, stressing that it has been implemented even during the time of former President Gloria Macapagal Arroyo and her successor, Benigno Aquino III.

Basic food items such as rice, fish, meat and vegetables have been major drivers of inflation this year, with the contribution of rice alone rising 10 times to one percentage point of the inflation rate, according to the Department of Finance.

As to the implementation of a new round of increases in the excise tax on fuel, Lacson said the effect on economy remains to be seen.

But he added that the economic managers of President Duterte noted that fuel is now cheaper, compared to 2017, even before the implementation of the excise tax.*


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