GOBYERNO KAILANGANG UMAKSYON: Solon pushes for the removal of VAT on electricity

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Senator Paolo “Bam” Aquino IV has called on the government to remove the value added tax (VAT) on electricity to help ease the concerns of power consumers from the high prices of basic needs and services.

The senator said that the government should make needed measures to lower power prices, specifically through the removal of VAT on electric generation, transmission, and distribution as consumers are facing another cycle of electricity rates hike.

“Kawawa naman ang ating mga kababayan. Hindi pa nga nakakaahon sa taas presyo, dagdag singil naman sa kuryente ang kanilang papasanin, (Let us help our poor fellowmen. They have yet to recover from the series of price increases and now there is an electricity price hike in the offing that they have to deal with),” Aquino was quoted as saying in a Manila Bulletin report.

“Dapat kumilos agad ang gobyerno para maibsan agad itong pahirap sa ating mga kababayan, (the government should take action immediately to help alleviate the plight of our citizens),” the senator added.

Earlier, Aquino filed Senate Bill. 670 which aims to lower electricity rates through removing VAT from the sale of electricity by all electric companies and cooperatives, as well as the removal of VAT on electric generation, transmission, and distribution which are being charged to consumers.

The senator also said the government should implement needed reforms in the energy sector in order to bring down the cost of electricity in the country.

“Kailangan simulan agad ang mga mahahalagang reporma sa power industry para hindi mahirapan ang taumbayan, (The government should start introducing major reforms in the power industry in order to help ease the burden of the public),” he said.

He suggested the government should focus more on infrastructure projects to solve the country’s supply issues.

In addition, he also said the government should remove the red tape in order to improve competition and welcome more players in power generation.

The Manila Electric Co. (Meralco) recently announced that they will charge consumers of P0.5782 per kilowatt hour (kWh) this month, totaling to a P114 increase in overall bill for a typical household consuming 200 kWh.

Meralco said the power price hike was mainly due to higher plant charges under power supply agreements (PSA) and wholesale electricity spot market (WESM).