THE Trade Union Congress of the Philippines (TUCP), the nation’s largest confederation of labor federations, renewed its call to President Ferdinand Marcos Jr. to certify House Bill 6740 as urgent.
The measure seeks to abolish the 12-percent value-added tax (VAT) on electricity amid warnings from the Energy Regulatory Commission that prices could rise further due to increases in international coal, oil, and liquefied natural gas prices, as well as tightening supply conditions in global energy markets.
Meanwhile, the Philippine Chamber of Commerce and Industry (PCCI), the Employers Confederation of the Philippines, and the Philippine Exporters Confederation echoed the TUCP’s call in a joint statement.
“Unlike other countries in the region, the Philippines not only does not subsidize fuel and electricity but also taxes these industries. Removing excise taxes temporarily will benefit all sectors, rich and poor alike, which is a better solution than providing ‘ayuda’ only to the poor,” said PCCI Chairman Emeritus Sergio Ortiz-Luis Jr.
The business groups noted that high power costs remain one of the country’s biggest barriers to competitiveness, particularly in manufacturing. Removing VAT on electricity would reduce operating costs, helping factories expand production, attract new investments, and increase the sector’s contribution to GDP and job creation.
The groups added that the measure would safeguard existing jobs and support the creation of new ones.
The TUCP noted that it has been 24 years since Republic Act 9136, or the Electric Power Industry Reform Act, promised reliable and affordable electricity. However, only four years later, RA 9337 amended the National Internal Revenue Code and imposed the 12-percent VAT on electricity, including the sales of generation, transmission, and distribution companies.
“We are not only paying VAT on electricity we actually consume, but are even charged VAT on system losses or the electricity we never used in the first place. Mr. President, now more than ever, we should put an end to this extremely excessive taxation imposed on our extremely expensive power by certifying as urgent House Bill 6740,” the group added.
TUCP President Raymond Democrito Mendoza said it is a rare occurrence that both labor and business — which often clash on issues such as wages and contractualization — stand shoulder to shoulder for a common cause.
“When both workers and employers raise the same urgent call, the government must listen,” Mendoza said.
TUCP Vice President Luis Corral said exempting electricity sales from VAT would provide immediate relief to workers and consumers while triggering more quality job opportunities.
“This is the better approach than the age-old palliatives and ayuda (aid),” Corral added.
