Govt’s TRAIN to blame for highest inflation in nearly 10 years — IBON

Features Philippines Aug 24, 2018 at 2:45 pm

IBONResearch group IBON said that the government’s insistence on higher taxes especially on the poor is among the factors driving inflation rates to their highest in nearly a decade. The group said that runaway inflation is due to the peso depreciation and rising global oil prices combined with the Tax Reform for Acceleration and Inclusion (TRAIN) law. Among these, TRAIN’s higher consumption taxes are directly within the government’s control and it can immediately arrest the tax-driven portion of inflation if it chooses to do so.

The Philippine Statistics Authority (PSA) has reported a 5.2% inflation rate for the month of June. The biggest price increases were in food, especially in corn, vegetables, meat and rice; alcohol and cigarettes; transport; housing, water, electricity, gas, and other fuels; and education. This 5.2% inflation rate is more than double the 2.5% in the same period a year ago and four times the 1.3% inflation rate in June 2016 at the start of the Duterte administration.

The June inflation rate appears as the fastest in only five years because available estimates using the current base year [2012=100] are only until 2013. But IBON noted that inflation today would already be the fastest in nearly a decade, or since March 2009, using inflation data according to the previous base year [2006=100] as an approximation.

(Read story…)