Planned coal tax hike seen harming manufacturing sector

Hitting a 10-percent growth next year would be a major challenge to the manufacturing sector if a significantly higher coal excise tax would be imposed, Trade and Industry Secretary Ramon Lopez said.

Lopez said the Senate proposal to raise the coal excise tax by nearly 3,000 percent would adversely impact the manufacturing sector.


Lopez earlier said the sector was expected to grow by more than 10 percent next year, following the recovery of its performance in the past years, especially after it reached a 9.4-percent growth in the third quarter of the year, its best quarterly performance in nearly a decade.

The excise tax is part of the recently passed Senate Bill 1592, the Senate version of the first tax reform package under the Duterte administration. If passed, it would lead to an increase in the excise tax on coal from P10 per metric ton to P100 per ton in the first year of implementation, P200 per ton on the second year, and P300 per ton on the third year


“When it is that rapid, it would be challenging. Offhand, we still need to study that. That’s too big an increase,” he said.

The trade chief’s comment echoes the concern raised by Sen. Sherwin Gatchalian, who said during the recently concluded National Export Congress that the government might “see a slowdown in the manufacturing sector especially since it’s so dependent on electricity.”

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TAGS: coal excise tax, manufacturing, Secretary Ramon Lopez
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