The National Economic Protection Association (NEPA) takes exception to the statement of the Foundation for Economic Freedom that “special exemption of all oil products from VAT, re-establishment of the oil price stabilization fund, or worse, price controls, will surely lead to price distortions, misallocation and inefficiencies.”
NEPA believes that it is precisely the EVAT on oil, along with various taxes and add-ons on the final oil price that create the price distortions.
The FFF would have made us believe that EVAT is a natural cost. Well, it is not. The talented FFF surely must have known that EVAT is a late comer in the government’s effort to shore up revenues to the detriment of, well, the economy.
Instead of plugging loopholes in the tax code that allows corporations to evade paying correct taxes, the government took the easy way out thru the EVAT thereby making our tax structure more regressive – the poor carrying more of the tax burden rather than the rich.
There is something amiss when taxes on corporate profit – profit created via tons of government support – is actually reduced while the common tao is taxed for every single noodle pack he buys at the sari-sari store and have for his meal.
FFF call for more transparency from oil companies and more discussions among consumers is well intentioned but ultimately lame.
At a time like this, can we really justify tax-heavy petroleum prices so that the government can rake it in every time petroleum prices skyrockets?
If removing EVAT from oil prices so that the burden on the common tao bears is populist, what do we call the policy that allows oil companies to profit billions during crises?