The Duterte administration says the recently-passed Tax Reform for Acceleration and Inclusion (AKA Train) law should do the Filipino people a world of good.
At first glance, it may accomplish something that taxpayers will welcome since it relieves them of the burden of excessively high income taxes. What the government does not talk about is the sudden rise in the prices of many goods and services that will result because of Duterte’s Train.
One personal example may well be a sign of what consumers can expect in the next few weeks and months. In this case, however, it was felt by yours truly a few days after the bill was signed into law, the effects of which should not have taken effect until this first quarter of 2018.
As I am sometimes wont to do, I had a fastfood dinner in that odd period between Christmas Day and New Year’s Day. Like most everybody else, I had gotten tired of too much of the grand (AKA unhealthy) food served everywhere during the holiday season.
One particular good-for-two meals that my partner and I sometimes order is from KFC. It went for about P250 or $5 throughout most of 2017. So what happened last week?
That very same meal was now selling for something like P320.
We were not only surprised, but stunned. That was a whopping increase, where usually most such places would hike their retail prices by a tolerable five percent per year, on the average.
She pointed out to the staff that the increase was pretty dramatic, and the reply she got was a stunner. It was because of that Train law, she was told.
My partner wanted to argue that the Train law would not affect prices until the first quarter of 2018 at the earliest, but she decided not to spoil the holiday mood. I could only shake my head in disgust.
What the fastfood joint did was not unexpected. A lot of companies big and small like to commit these little crimes against consumers if they think they can get away with it. Their argument goes something like this: Since everybody has a lot more money during the Christmas season, it’s perfectly all right to jack up their prices.
Yes, most employees would have gotten their legally-mandated 13th month pay, but this was a little too much. And the signing of the Train law gave them the perfect opportunity to pull a fast one over consumers.
This was just the beginning, of course. The government did say that the prices of certain goods will definitely go up because of the Train law. What the government appears unable to do is to prevent the big players from victimizing the lowly and generally powerless consumers.
One news story this week said that the Department of Energy was making sure that those big, bad oil companies would not jack up their prices this early, seeing that they were still selling stocks that they had prior to the signing of the Train law.
Why such a step needed to be done speaks volumes of private companies who enjoy nothing more than to profiteer from a new law.
Eventually, gas and diesel prices will have to go up. Or should I say skyrocket?
The transport industry is already preparing to ask for an increase in the fares paid by the riding public, and their request is sure to be granted.
Very incidentally, the prices of cars are among those that will increase dramatically in the coming weeks. The only good thing – if you can call it that – is that the increases will be higher for the more expensive vehicles. So it would be better for a consumer to buy one of those small cars rather than an SUV, which is infinitely safer.
I don’t know how the administration will justify the coming higher prices of nearly everything, which will automatically have an inflationary effect and dampen the country’s economic growth.
We all know that old saying that the only certainties in life are taxes and death. This Train tax, however, will prove to be extremely painful, and could just hasten the demise of the millions of Filipinos who are still struggling to make end meet.
This tax is supposed to be inclusive?
No it most certainly is not. It will only prove to be a backbreaking burden that the majority of Filipinos will have no choice but to bear.
Thanks for nothing, Mr. Duterte.