Senators on Wednesday called for a review of taxes on electricity, saying these continue to add to the burden of Filipino consumers amid concerns over power bills raised on social media.
During the Senate Proactive Response and Oversight for Timely and Effective Crisis Strategy (PROTECT) committee hearing, lawmakers directed the Energy Regulatory Commission (ERC) to study the impact of removing taxes on electricity.
Study the tax component
“We’ll request the ERC to study the tax component,” Senator Sherwin Gatchalian said, noting that aside from the value-added tax (VAT), consumers also shoulder other levies such as local franchise taxes and energy taxes.
ERC chairperson and CEO Atty. Francis Saturnino Juan said the commission has already written to the Bureau of Internal Revenue (BIR) to discuss the issue of taxes on electricity.
Senate Deputy Minority Leader Rodante Marcoleta reiterated his proposal to remove the 12 percent VAT on electricity bills, which Juan said he would not oppose.
Proposal to remove VAT from electric bills
“Mayroon po akong panukala na tanggalin na ang 12 percent tax on electricity,” Marcoleta said. “Pati system loss may tax. Dito lang sa atin nangyari na pati ba naman yung bagay na wala, nata-tax (I also propose that the 12 percent (VAT) electricity tax be removed. Even system loss is taxed. It's only here in the Philippines that something that doesn’t exist, is taxed!).”
Marcoleta added that these government-imposed charges contribute to higher electricity rates.
“Kaya tumataas ang singil dahil sa mga ganitong contributory factors,” he said.