The Department of Finance (DOF) has found a new champion in the person of Miss Earth Philippines Karen Ibasco for its proposal under the tax reform bill to gradually increase excise taxes on petroleum products, which, she said, will help transition the economy from the use of fossil fuels to renewable energy (RE) sources.
Ibasco, a medical physicist, voiced her support for the fuel excise tax provision at one of the recent hearings conducted by the Senate ways and means committee on the proposed Tax Reform for Acceleration and Inclusion Act (TRAIN).
The Ms. Earth Philippines titleholder, who is a strong advocate of the shift to RE and sustainable energy sources, said gradually increasing fuel excise taxes will also help in the “decarbonization” of the environment.
“Since now we are also talking about the Tax Reform for Acceleration and Inclusion (Act), there is a section about the excise tax on petroleum products, and it is a form also of carbon tax in which it can do a great deal [for] the environment as we see it to be one of the things that we can transition people from using fossil fuels to renewable energy. And we’ll also do our part if ever this will be passed. It’s also a great deal of help to the environment,” Ibasco said at the hearing of this committee chaired by Sen. Juan Edgardo Angara.
DOF Undersecretary Karl Kendrick Chua and other finance officials were also present at the hearing to explain the social benefits that the fuel excise tax adjustments would provide to the country’s poor and vulnerable sectors.
Under the proposed TRAIN, Chua said that 40 percent of the incremental revenues from the fuel excise tax hike would be allocated for direct cash transfers and other programs to help the bottom 50 percent of the population cope with the ripple effects of this tax adjustment.
Ibasco said that while “it’s a challenge for us to really make people understand” the benefits of increasing fuel excise taxes under the TRAIN, she expressed hope that this tax reform bill would be passed into law to help protect not only the environment but public health as well.
She said that as a signatory to the Paris climate change treaty that aims to reduce greenhouse gas emissions, the Philippine is committed within a specific timeframe to cut its carbon emissions, which can be done partly by approving the fuel excise tax provision under TRAIN.
Earlier, a number of health advocacy groups have also joined the snowballing clamor to adjust fuel excise taxes under TRAIN to squarely address the worsening air pollution in cities and help mitigate the devastating impact of global warming on the environment.
In separate positions papers, the Health Care Without Harm (HCWH), the Institute for Climate and Sustainable Cities (ICSC), the Philippine College of Chest Physicians (PCCP) and the Clean Air Philippines Movement, Inc. (CAPMI) called on the government to use the TRAIN as a tool to clear the way for the country’s quick transition to more renewable energy sources to help ensure a cleaner, safer and more sustainable means of supplying the needs of the power and transport sectors.
The ICSC also said it is supporting the TRAIN for “its progressive intent and equitable” effects, “as incremental revenues are needed for investments in human capital and badly needed infrastructure.”
“Meanwhile, the oppositors of tax reform contend that any increase in refined petroleum products is anti-poor. We don’t agree with that proposition. Instead, we support the assertion of the DOF that the poor can better be helped through improved targeting of poverty alleviation programs, instead of subsidizing pollutive behavior. The poor, in fact, suffer most—from health damages caused by pollution and from the impacts of climate change,” the ICSC said in its position paper submitted to the Senate ways and means committee.
The Angara-chaired committee has been holding public hearings on the proposed TRAIN, which was filed as Senate Bill No. 1408 by Senate President Aquilino Pimentel III. The House of Representatives approved its version of TRAIN–House Bill 5636–last May 31 by a vote of 246-9 with 1 abstention.
The HCWH said the TRAIN’s provisions on fuel excise taxes can help address the adverse health and environmental impacts of the increase in greenhouse gas emissions, which lead to global warming and threats to public health.
It said that in 2012 alone, fossil fuel emissions were “responsible for 3.7 million premature deaths from heart attacks, strokes, chronic obstructive pulmonary disease (COPD), lung cancer, and acute lower respiratory infections in children.”
Alongside worsening air pollution in the country, greenhouse gases emitted by the burning of fossil fuels also settle in the oceans. This, in turn, leads to ocean warming that is harmful to marine life and can also lead to oceanic acidification resulting to coral bleaching and eventual changes in the migration and feeding cycles of marine species, according to HCWH.
CAPMI, for its part, applauded the DOF’s effort to address the climate change issue through a tax policy that would help curb the behavior of Filipinos.
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