DTI: TRAIN Law has minimal impact on prices of Basic, Prime Goods

Written by Paul Jaysent Fos | Romblon News

Department of Trade and Industry (DTI) Secretary Ramon M. Lopez allayed the fears of Filipino consumers on the impact of the Tax Reform for Acceleration and Inclusion (TRAIN) Act, the first package of the Comprehensive Tax Reform Program (CTRP) under President Rodrigo Roa Duterte’s administration.

“While TRAIN is perceived to possibly increase the prices of products of basic necessities and prime commodities (BNPC) in the market, DTI’s initial assessment of applying the excise tax shows only minimal impact on the prices of basic and prime goods,” Trade Secretary Lopez said.

DTI is continuously monitoring market prices to ensure that any increase will be nominal, reassured Sec. Lopez.

The products under the BNPC that DTI monitors are the following: canned sardines; processed milk; coffee; detergent and laundry soaps; bread; instant noodles; canned products like luncheon meat, meat loaf, and, corned beef; toilet soap; and cement.

Sec. Lopez explained that DTI, through its Consumer Protection and Advocacy Bureau (CPAB), evaluated the possible effects of the new tax rates on basic necessities and prime commodities, and found that it would cause minimal impact as most manufacturers would opt to absorb the increase for fear of losing market share.

The newly approved TRAIN law seeks to lower personal income taxes, increase excise tax on fuel products, and impose tax on sweetened beverages, among others.

For diesel, a Php 2.50 tax per liter will be imposed this year same with fuel oil, while there will be increases of Php 1.00 per kilogram for LPG and Php 50.00 per metric ton for coal.

Sweetened beverages such as juice drinks, sweetened tea, all-carbonated beverages, flavored water, energy and sports drinks, cereal and grain beverages, and other nonalcoholic drinks that use caloric or non-caloric sweeteners will be taxed Php 6.00 per liter. Meanwhile, Php12.00 per liter will be taxed for those that contain high fructose corn syrup (HFCS).

All milk products, 100% natural fruit and vegetable juices, meal replacement, and medically indicated beverages, as well as instant coffee are exempted from this excise tax on sugar.

“The TRAIN law should not immediately affect the prices of basic necessities and prime commodities because retailers still have inventories before the tax reform law took effect. As such, we encourage consumers to report to DTI retailers who are already increasing their prices using the implementation of the new tax reform law as a reason,” Secretary Lopez said.

Business establishments that will commit illegal acts of price manipulation, specifically profiteering, shall be imposed a fine of not less than Php 5,000.00 nor more than Php 2M, and imprisonment for 5 to 15 years.

DTI-Consumer Protection Group (CPG) Undersecretary Atty. Ruth B. Castelo supported Sec. Lopez’s declaration, saying: “We will continue to closely monitor the market on the movement of prices of basic and prime goods and their raw materials to ensure that consumers will only purchase reasonably-priced goods in the market in light of the new tax reform law. Our teams from the DTI-Fair Trade Enforcement Bureau (FTEB) and the DTI-Regional Operations Group (ROG) are ready to assist our consumers.”

To report incidents of profiteering, call DTI Direct 751.3330 or send a text message through 0917.8343330.