DTI chief tells TRAIN critics: Be objective and study it first

MANILA, Philippines — Trade Secretary Ramon Lopez called on detractors of the Tax Reform for Acceleration and Inclusion (TRAIN) law to be “objective and look at the numbers” and to study it first for people to understand its benefits.

TRAIN critics claimed that the law was anti-poor as it would lead to higher consumer prices, even threatening to question its constitutionality before the high court.

“Those kinds of remarks, I would say rhetoric, are always used even if they are baseless. If the provisions of the TRAIN are studied… if we are reasonable, we would understand its benefits. We just have to be objective and look at the numbers,” Lopez said in an interview over state-run radio station dzRB.

Lopez claimed that the legislation would create a “virtuous” cycle in the economy as it would generate additional revenues that can be used to fund infrastructure projects like roads, bridges, railways, and airports.

“If we have several infrastructures, production costs would be lower and there would be more investments because they will be encouraged. It will create a virtuous cycle,” Lopez said.

Despite the criticisms, the DTI chief maintained that the measure was “pro-poor,” citing the higher take-home pay that minimum wage earners will enjoy.

“This is pro-poor because minimum wage earners now have extra income. They have bigger take-home pay,” he said.

“The reforms will bring a very positive cycle in the economy because our countrymen will enjoy a higher take-home pay. They have more money to spend and this will benefit the economy,” he added.

Presidential spokesperson Harry Roque said the government is ready to defend the tax reform package before the high court, describing the opposition’s claims as “baseless.”

The TRAIN law, a priority measure of the Duterte administration, is anticipated to generate P130 billion in revenues for the government.

Under the law, minimum wage earners with an annual income of P250, 000 are exempted from paying the personal income tax. However, transport fares, electricity costs, and consumer prices are expected to rise as an effect of new taxes imposed on diesel, liquefied petroleum gas, kerosene and bunker fuel for electricity generation and higher taxes on other oil products.