THE Philippines’ largest business and labor group leaders said they want the government to implement urgent relief measures, including the suspension or removal of value-added tax (VAT) on essential goods, to mitigate the impact of rising inflation on households and enterprises.
In a joint statement released on Thursday, the Leaders Forum — composed of the Employers Confederation of the Philippines, the Philippine Chamber of Commerce and Industry, and several major labor federations — said the continued imposition of VAT on fuel, electricity, and basic commodities has become an unsustainable burden.
“Across the country, workers continue to face increasing prices of food, fuel, transport, and other essential goods, steadily eroding real wages and straining household budgets. At the same time, employers, particularly micro, small, and medium enterprises, are grappling with higher input costs, weakened demand, and growing uncertainty in sustaining operations and preserving jobs,” the statement read.
“The continued imposition of value-added tax on essential goods adds to the cost burden borne by both consumers and producers. These taxes, while important from a fiscal perspective, have real and immediate impacts on affordability, enterprise viability, and overall economic activity,” it added.
They called for a targeted review and possible suspension of VAT on essential goods, alongside stronger monitoring to ensure tax reductions translate into lower prices.
They also urged the government to certify as urgent a measure increasing the tax-exempt income ceiling, expand support for vulnerable sectors, and pursue time-bound fiscal interventions for industries experiencing extraordinary gains.
The groups likewise pushed for sustained dialogue with the Marcos administration and greater representation in policymaking bodies, saying such engagement is necessary to address wage, employment, and business sustainability concerns.
President Ferdinand R. Marcos, Jr. earlier said he is not keen on removing VAT on petroleum products, citing its role as a revenue source for social subsidies. He instead signed Executive Order No. 114 suspending excise taxes on liquefied petroleum gas and kerosene after global oil prices breached the statutory threshold. — Erika Mae P. Sinaking
