DOE supports VAT cut on electricity

The Department of Energy has expressed support for proposals seeking the removal of the value-added tax (VAT) on electricity as part of efforts to cushion the impact of the ongoing energy crisis on consumers.

Energy Secretary Sharon Garin said the agency remains consistent in supporting measures that could help reduce electricity costs, in line with the directive of President Ferdinand Marcos Jr. for government offices to ease the burden of rising energy prices on the public.

Highlighting the need to bring down power rates, Garin told reporters during a media briefing that “(they) have been consistent in (their) opinion on VAT removals and anything that would help lower the price of electricity.”

“This also includes the revisiting of the VAT or any taxes that are set in our electric bill,” she added.

The energy chief, however, clarified that decisions involving tax adjustments remain under the authority of the Department of Finance.

“(T)he removal of the electricity VAT is for the (DoF) to assess and review,” Garin said.

“(W)e leave it also to their decision on how this will overall impact the economy and on the basic services of the government,” she added.

Several lawmakers from both chambers of Congress have earlier pushed for the removal of VAT on electricity, citing the country’s high power rates, which are often considered among the highest in Asia.

Sen. Risa Hontiveros recently filed Senate Bill 2076 seeking to remove the VAT imposed on systems loss charges currently passed on to electricity consumers.

According to Hontiveros, Filipino consumers should no longer shoulder what she described as the “double burden” of paying VAT on top of already expensive systems loss charges imposed by electric utilities.

“We must immediately end this unfair arrangement, especially now that electricity costs are going up,” the senator stressed. TRACY CABRERA