MANILA, Philippines – (UPDATE) A resolution that will require the government to subsidize consumers of power and oil using the projected P16.7-billion collection from the 12-percent value-added tax on oil this year has been adopted unanimously by the committee at the House of Representatives tasked to study the matter.

The ways and means committee expressed its support Tuesday for House Joint Resolution 18 filed by Speaker Prospero C. Nograles that proposed the redistribution of P6.5 billion to households, whose electricity consumption was 500 kilowatt hour (kwh) and below, while the remaining P10.2 billion would be used to provide subsidy in fuel consumption.

Of the P10.2 billion, P8.3 billion will be used in providing approximately P1.30 per liter subsidy for diesel to benefit public transport utilities and commuters and P1.9 billion will be redistributed to subsidize P1 per liter of liquefied petroleum gas (LPG) consumption of households, the resolution said.

But Teresa Habitan, director of the Department of Finance, asked the committee led by Antique Representative Exequiel Javier, to reconsider the 500-kwh cap for power subsidy.

Javier had proposed two options on how the subsidy would be given away: One is for government to distribute the money to households through the Department of Social Welfare and Development and another is for government to “directly pay electric companies the subsidy for its consumers and in the case of fuel, it can be in a form of subsidy paid to oil companies.”

“Perhaps, if you want to be able to service those who really need the subsidy, the House may reconsider the cap that you used and just simply keep the lifeline rate of 100 kwh,” Habitan told the committee.

“Those who consume 500 kilowatt hours will be able to afford paying and if in fact, they find it difficult to pay, then they can reduce the number of kilowatt hours they consume,” she said.

If the real intention is to help those who are really needy, Habitan said the middle-class must be encouraged instead to use more energy efficient technologies or to turn off some of their light or reduce the number of electronic equipment that they have in the house.

The committee instructed the DoF official to just submit the proposal for consideration when the measure reached the floor.

Habitan also told the committee that exempting lifeline users would mean a revenue loss of P465.7 million for the government.

The government, she said, would also incur a revenue loss of P1.9 billion every year if the VAT on systems loss would be scrapped.

Meanwhile, Bayan Muna Representative Teodoro Casiño, an opposition member, questioned the legal basis of the joint resolution, which he said a supplemental budget or amendment to the value-added-tax law could have also achieved.

The resolution was approved Tuesday without discussing how the money would be distributed to oil and power consumers.

But Casiño acknowledged that these issues could still be raised and clarified when the resolution would be transmitted on the floor for adoption.

Senior Deputy Majority Leader Neptali Gonzales II explained that like any other measure, the resolution would go through the usual deliberations before its final approval on the floor.

And since it is a joint resolution, Gonzales said the Senate should also pass its counterpart measure before the two chambers could sit for a bicameral conference meeting, in case of conflicting versions.

The measure, he said, has to be ratified also by both chambers before it could be transmitted to President Gloria Macapagal-Arroyo for signature.