Second package of tax reforms seen to increase electricity prices
By Alena Mae S. Flores – August 26, 2018 at 07:45 pm
from manilastandard.net
A consumer watchdog warned the implementation of the second package of the Tax Reform for Acceleration and Inclusion law will increase power prices.
“We are monitoring the removal of incentives in the power sector under the Train-2, particularly in the renewable energy industry. Everything will be subjected to 12-percent value added tax,” Laban Konsyumer Inc. president and former Trade undersecretary Vic Dimaguiba said.
Dimaguiba said Train 2 would become an additional burden to the consumers, on top of the package one of the tax reforms.
He said the removal of the incentives might force developers to pass on the additional cost to consumers. “It is part of the supply chain,” he said.
Section 15(g) of Republic Act No. 9513 or the Renewable Energy Act exempts renewable energy from the value added tax.
It states that “the sale of fuel or power generated from renewable sources of energy, such as but not limited to, biomass, solar, wind, hydropower, geothermal, ocean energy and other emerging energy resources such as fuel cells and hydrogen fuels, shall be subject to zero percent value-added tax.”
The National Geothermal Association of the Philippines earlier called for the the exemption of the Renewable Energy Law from the proposed Comprehensive Tax Reform Package 2 as it would affect the competitiveness of the geothermal industry.
The Petroleum Association of the Philippines also asked the government to continue to grant incentives to the industry given its “high risk” nature.
