This story
was taken from Bulatlat, the Philippines's alternative weekly
newsmagazine (www.bulatlat.com, www.bulatlat.net, www.bulatlat.org).
Vol. V, No. 2, February 13-19, 2005
CWR Facts & Figures
Alert:
Unmasking the VAT Myth
|
A |
B |
C |
D |
E |
F |
G |
||
|
Commodity |
Current Ave. Price |
Without VAT |
10% VAT |
12% VAT |
Minimum Expected New Price |
Minimum Expected Price increase |
||
|
Rice (kg.) |
22.00 |
20.000 |
2.000 |
2.400 |
22.400 |
0.40 |
||
|
Cooking Oil (lapad) |
18.00 |
16.364 |
1.636 |
1.964 |
18.327 |
0.33 |
||
|
Coffee (25g.) |
18.00 |
16.364 |
1.636 |
1.964 |
18.327 |
0.33 |
||
|
Sugar (white/kg.) |
27.00 |
24.545 |
2.455 |
2.945 |
27.491 |
0.49 |
||
|
Milk (200g.) |
39.00 |
35.455 |
35.455 |
4.255 |
39.710 |
0.71 |
||
|
Sardines |
10.00 |
9.100 |
0.910 |
1.092 |
10.192 |
0.19 |
||
|
Laundry soap (bar) |
16.00 |
14.544 |
1.454 |
1.745 |
16.289 |
0.29 |
||
|
Bath soap |
22.00 |
20.000 |
2.000 |
2.400 |
22.400 |
0.40 |
||
|
Noodles |
5.50 |
5.000 |
0.500 |
0.600 |
5.600 |
0.10 |
||
|
Corned beef |
23.00 |
20.910 |
2.091 |
2.509 |
23.419 |
0.42 |
||
|
LPG (11 kg. Cylinder) |
390.00 |
390.000 |
- |
46.800 |
436.800 |
46.80 |
||
|
Pork (kg.) |
145.00 |
131.840 |
13.184 |
15.821 |
147.661 |
2.66 |
||
|
Chicken (kg.) |
95.00 |
86.340 |
8.634 |
10.361 |
96.701 |
1.70 |
||
|
Beef (kg.) |
180.00 |
163.636 |
16.364 |
19.636 |
183.272 |
3.27 |
||
|
Formula |
|
|||||||
|
Column B = Column C + Column D |
||||||||
|
E = C x 12% proposed VAT |
||||||||
|
F = C + E |
|
|
||||||
|
G = F – B H = ((F – B)/B) x 100 |
|
|
||||||
Despite what some solons say, noodles, sardines and some agricultural products will be affected by the proposed VAT increase. Consumers may have to shell out at least P0.10 per pack of noodles and at least P0.19 per can of sardines if the 2% VAT increase will be approved by the Congress.
Some agricultural products like pork, pork liempo, beef and beef brisket, dressed chicken and even brown sugar will be affected by the VAT rate hike as these commodities have already undergone processing.
A family of five may have to shell out an additional P18.20 at the minimum to buy an average of 45.5 kg of rice per month. This is equivalent to almost a kilo of rice at the prevailing average price.
Every household or establishment who consumes at least 100 kWh of electricity may have to expect P29.86 to P40.24 power rate increase if the 10% to 12% VAT is imposed on power suppliers and generation companies, based on the data released by Napocor.
The value of the peso may diminish by P0.18 to P0.20 if the 12% VAT is approved, or at least 1.8% to 2% inflation rate due to VAT increase alone. For minimum wage earners in the NCR, this may mean slashing their daily wages by at least P5 to P6.
The proposed VAT increase may render the peso nearly valueless. When compared to the average prices in year 2000, the true value of the peso (or purchasing power of the peso) may slide to P0.51 from its current value of P0.53 due to VAT increase alone. Posted by Bulatlat
For queries or interviews, please contact Jojo A. Guan (CWR Deputy Executive Director), or Shirley Nuevo at 926-1956 or 411-2796.
© 2004 Bulatlat ■ Alipato Publications
Permission is granted to reprint or redistribute this article, provided its author/s and Bulatlat are properly credited and notified.