Duterte approves P200 monthly 'ayuda' for poor families, retains excise tax on fuel

President Rodrigo Duterte has approved providing a P200 monthly allowance or "ayuda" for poor households for an entire year to ease the impact of fuel price hikes, Malacañang said on Wednesday.

At the Palace briefing, acting presidential spokesperson Martin Andanar said Duterte approved the two recommendations of the Department of Finance (DOF) in light of the series of increases in fuel prices.

“Inaprubahan ng Pangulo ang dalawang rekomendasyon ng DOF kaugnay sa pagtaas ng fuel price (The President has approved the two recommendations of the DOF regarding the fuel price hikes),” he said.

“Una, ang pag-retain ng fuel excise taxes na ini-impose ng TRAIN [Tax Reform for Acceleration and Inclusion] Law dahil ang pagsuspende nito ay magre-reduce ng government revenue ng P105.9 billion na magpopondo sa mga programa ng pamahalaan. At pangalawa, ang pagbibigay ng targeted subsidies ng P200 bawat household to the bottom 50% of Filipino households,” Andanar said.

(First, the retention of fuel excise taxes that are imposed by the TRAIN Law because the proposed suspension will reduce government revenue — which funds government programs — by P105.9 billion. Second, the distribution of targeted subsidies of P200 to every household under the bottom 50% of Filipino households.)

During Duterte's Talk to the People taped on Tuesday and aired on Wednesday, Finance Secretary Carlos Dominguez III proposed providing a P200 monthly subsidy for poor households for an entire year to ease the impact of fuel price hikes. He also recommended retaining the excise tax on fuel.

Dominguez admitted that the amount might not be enough but he pointed out that this is what the government can afford to provide as of this time.

The targeted subsidies will amount to P33.1 billion in budgetary requirements, according to Dominguez.

Dominguez said the funds for the subsidy would be sourced from the higher collection of value-added tax (VAT) due to the higher prices of fuel.

With the $110 per barrel Dubai crude oil price, Dominguez said VAT revenues will increase by P26 billion. At $125 per barrel Dubai crude oil price, VAT revenues will increase by P34.6 billion.

Some senators however on Wednesday said the cash aid is not enough, and called for the temporary suspension of excise tax on fuel.

“Against P200 per month, napakaliit (that's too small). ‘Di kakayanin ‘yun, ‘di makakasapat (That won't suffice),” presidential candidate and incumbent Senator Panfilo Lacson said in a press conference in Madella, Quirino.

"Coming in after 11 weeks of successive oil price increases, the government's P200 per month cash assistance to poor families is a pittance. At P6.66 per day, it can't even get one a jeepney ride to the minimum distance," Senator Poe said in a statement.

Lacson said the fuel excise taxes should be suspended temporarily until the conflict between Russia and Ukraine deescalates.

On Tuesday, oil firms implemented a major price hike on fuel products, marking the 11th straight week of increases.

Prices per liter of fuel products went up as follows: gasoline by P7.10, diesel by P13.15, and kerosene by P10.50.

In the past 10 weeks, prices of fuel products have been hiked, and have only been on an upward movement so far this year.

The Department of Energy has maintained that the ongoing conflict between Russia and Ukraine has hit global prices. The Philippines does not directly import from Russia, but sources its supply from other countries which in turn source their supply from the country. —KG, GMA News