A SENATOR tipped to chair the chamber’s Ways and Means Committee in the 19th Congress said he considers sovereign debt management more important than revenue-eroding measures like a suspension of fuel excise taxes, which would impair government efforts to reduce such debt.

“We have just recovered from the pandemic and we still have a lot of debt,” re-elected Senator Sherwin T. Gatchalian said in a statement over the weekend, noting that a large portion of the government’s expenses will go to debt incurred to purchase coronavirus disease 2019 (COVID-19) pandemic vaccines.

“This must be prioritized to strengthen the so-called economic fundamentals and so that we can borrow even less if needed,” he added.

At the end of April, National Government debt was at a record P12.76 trillion, up 0.7% from the end of March.

However, Mr. Gatchalian said the Senate can still explore ways to relieve the burden of high fuel prices in hearings, adding he was open to allowing legislators pushing for the excise tax suspension to air their arguments.

“This is my perspective… I want to see if they have a different computation and analysis, so we can listen to it to know whether (their proposals) will help or not. We want to look at the situation as a whole,” he said.

The suspension of excise taxes on petroleum would result in as much as P131.4 billion in foregone revenue in 2022, reducing the funds available to support the recovery, the Department of Finance (DoF) has said.

In an Oct. 20 memorandum to Finance Secretary Carlos G. Dominguez III, Undersecretary Antonette C. Tionko recommended that the suspension of excise taxes on fuel products be “appropriately studied” as the foregone revenue “may affect the government’s budget for COVID-19 recovery measures.”

The senator has called for consultations to discuss the impact of higher fuel prices.

The Energy department has told legislators mechanisms should be set up under Republic Act 8479 or the Downstream Oil Industry Deregulation Act to determine the cost breakdown of fuel. Mr. Gatchalian said it may take time to make oil prices more transparent through such an unbundling of costs.

As an immediate solution to the continuing oil price hike, the senator proposed an expansion of the cash aid program to P3,000 monthly for jeepney drivers and P1,000 monthly for tricycle drivers over the next five months.

He said this will cost about P4 billion, against the P150 billion in foregone revenue should the excise tax be suspended.

“We can also expand the Libreng Sakay (free ride) program of the government, so those who stop plying their routes or plying the roads can be contracted by (the) government to serve the riding public,” he added. — Alyssa Nicole O. Tan