(Eagle News) – Funding for some programs will be “in peril” if the implementation of the Tax Reform for Acceleration and Inclusion (TRAIN) law is suspended.
This is according to Finance Undersecretary and chief economist, Gil Beltran, who made the comment following proposals to suspend the same due to a supposed spike in the rate of inflation, reportedly the fastest in more than 5 years.
According to Beltran, in particular, the government expenditures for 2018 on health, P107.3 billion; education, P672.4 billion; social protection, P141.4 billion; and infrastructure, P704.2 billion will be severely affected.
He said the spending to cover the 100 percent hike in the salaries of the military, which is equivalent to P62.8 billion; and the free tuition program in State Colleges and Universities (SUCs), at P51.4 billion for this year; would also be affected.
According to Beltran, while inflation reached 4.5 percent in April, month-to-month inflation “declined from 1.0 percent in January to only 0.5 percent in April.”
Year-to-date inflation, he added, was recorded by the DOF at 4.1 percent.
“This suggests a potential easing of inflation moving forward. The Bangko Sentral ng Pilipinas (BSP) expects inflation to temper and settle to 3.9 percent in 2018 and decelerate further to the midpoint of the target range (of 2 percent to 4 percent) in 2019,” Beltran said.
Even then, he said the April 2018 inflation was driven mainly by the higher prices of corn, fish, tobacco and personal transport which were “due to a variety of factors, and cannot be solely attributed to the impact of TRAIN.”
“The current spike in inflation is only temporary. All these programs we are implementing, which are made possible because of the additional revenues from TRAIN, are meant precisely to prevent prices from rising further in the future,” Beltran said.
“TRAIN is a long-term measure that would push the economy to a much higher development path, create more jobs and improve the living conditions for our people,” he added.
