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Facebook: Laban Konsyumer Inc.
LKI PRESS STATEMENT 2021-021
May 25, 2021
CONSUMER GROUP CALLS FOR CHANGES ON INDIRECT TAXES TO LOWER PRICES OF CONSUMER GOODS
Consumer Advocacy Group Laban Konsyumer Inc. (LKI) and its President Atty. Vic Dimagiba recently wrote to Senator Aquilino Pimentel III, Chair of the Senate Committee on Trade, Commerce and , Congressman Joey Salceda of the House Committee on Ways and Means and Congressman John Reynald Tiangco, Chair of House Committee on Trade and Industry on indirect taxes like safeguard duty, dumping duty, import duties. This move was done in order to further protect the consumers during the pandemic, and prevent indirect taxes from further burdening them during a time where they may find it difficult to make ends meet.
LKI said in the formal request and letter “Dear Senator Pimentel and Congressman Tiangco Our consumer group, Laban Konsyumer Inc. is respectfully submitting a proposal that will stop passing on to the consumers the indirect taxes imposed on certain business such as safeguard and dumping duties and higher duties on imported cement, ceramic tiles, vehicles rice and meat products.”
Dimagiba explained that “Under existing tax laws and cases, the liability for the payment of the indirect taxes fall on one person, the statutory taxpayer, however, the burden thereof can be shifted and passed on to another person, such as the tax is imposed upon the goods before reaching the consumers who ultimately pay for it as part of the purchase price . In this event, the consumer pays more for the goods.”
LKI highlighted “The current tax laws and cases on indirect tax laws defeat the objective of imposing duties on imported rice, meat products, cement, ceramic tiles and vehicles. In any event, the indirect taxes are shifted and the burden passed on to the consumers (PAL vs. Commissioner of Internal Revenue, G.R. No. 198759, July 1, 2013).”
LKI said “We propose that Congress introduce amendments to the shifting process and stop the passing on the tax burden to the consumers. We also need to prevent windfall profits of the statutory taxpayer in the event of a favorable appeal against the higher tariff coupled with a refund.”
Conversely, when the tariff is a reduction, there should be a law that the shifting process of indirect taxes should result to a reduction of the price of the goods in favor of the consumers. The State should not allow windfall income by stakeholders.
Dimagiba concluded by saying “these measures will ensure consumer welfare and protection if we can prevent these taxes from being passed on to consumers and further burdening them during this pandemic so we call for action and hope that these recommendations will be applied, followed and implemented as soon as possible.”