For nine weeks now pump prices of petroleum products have consistently been spiraling to levels causing havoc on the domestic economy. And sadly there is nothing that we can do to prevent their increase in the world market, hence it’s being felt the world over.
However, as what we have mentioned in a previous column, the government can certainly mitigate this increase and perfectly it is within its power to do so. Every time there is an increase in petroleum prices in the world market, local excise tax and other taxes imposed on petroleum correspondingly also increase.
The higher the price of petroleum the higher the collectible taxes will be on this product. Truth is government benefits more if prices of petroleum products go up because tax on this product also increases and more revenues for the government as well.
If the citizens are asked to bite the bullet as a result of these increases, can’t the government not bite the bullet also by forgoing the collection of taxes on petroleum just to mitigate the impact of an increase on its prices? The government is there to serve the interest of the people. Will forgoing the taxes due from petroleum not be an act of service to the burdened citizenry?
Economic managers will surely not be comfortable with this idea. That’s where good politics as practiced by good politicians should come in. Technocrats are there in government not to practice politics but to temper politics with technicalities. But all politics will not be good also.
A balance should be reached between the pragmatism of politics and the absolutism of economic technocracy. It is a given that technocrats ought to stand on their ground. But the necessity of politics if demanded by a given situation demands the setting aside of technicalities, the former should prevail.
Forgoing the collection of taxes on petroleum will surely have a negative impact on the overall economic landscape of the government. However, the negative impact of its collection far outweighs what good it may bring to the economy.
Currently, the local economy is agonizing. Inflation rate has just reached a level that is highest in a decade. Casually prices of prime commodities have increased to a level where 2.4 million Filipinos, according to Rep. Joey Salceda, who is a respected economist as well, will be buried in abject poverty, thus mired in suffering, misery and hopelessness.
If you have 2.4 million Filipinos in such a dire situation that number could easily become the core of a critical mass that can tip off the country’s political equilibrium which is far worse than just forgoing the collection of taxes on petroleum.
It should be understood that political unrest or upheaval is almost always triggered by the economic suffering of the people that the powers that be erroneously respond to by denominating it as an attempt to seize power. Political unrest is not caused by political colors such as “dilawans” because hunger is color blind.
Those who are into labor organizing can attest to the fact that it is so hard to organize the laboring class solely based on economic issues. This is so because “kahirapan” can be endured. Many workers would rather bear the pain and agony of economic hardship than be involved in political moves such as organizing a labor union in their work place.
It is when the right of the laboring class to air their grievances is arrogantly suppressed and it is when they are politically harassed when they exercise their rights under the law that organizing them into a union becomes easy and handy.
In like manner, ignoring the 2.4 million Filipinos expected to live in abject poverty because of the current economic woes faced by the country primarily triggered by the runaway prices of petroleum products and compounded by the increasing taxes collected from them by the government would be fatal. If there be any unrest as a result of this, it must be caused not by the spiraling cost of petroleum products but by government’s lukewarm reception to the cry for it to forgo in the interim the collection of taxes on petroleum.
Forgoing collection of taxes on petroleum is the more prudent political option to mitigate the situation than the technocratic insistence to collect them at the expense of the nation’s calm and peace.