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Alyansa para sa Bagong Pilipinas senatorial bet Benhur Abalos has reiterated his call to abolish the value-added tax (VAT) on electricity, as well as taxes on fuel exclusively used for power generation.

This, as Filipinos face an electricity rate hike this month, right in the middle of summer.

In a recent radio interview, Abalos criticized what he described as “layered and excessive taxation” that made Philippine electricity among the most expensive in Southeast Asia. 

“Due to this increase, it gets harder for ordinary families to keep the lights on. Twenty years ago, when I was a congressman, electricity had no VAT. I opposed it then, and I’m standing by that position now,” said the former Department of the Interior and Local Government (DILG) secretary.

According to Abalos, there are VAT at each stage of power delivery. “You have 12 percent VAT on generation, 12 percent on distribution, 12 percent on transmission—and then there’s system loss passed on to consumers. How can any country thrive like this?” he asked.

He warned that such high operating costs are driving investors away and crippling local industries--thus, leaving the very skilled Filipino workers out in the cold.

“We have world-class Filipino talent, but we’re losing jobs because it’s too expensive to operate here,” the senatorial hopeful said.

To address the problem, Abalos is proposing the remove the VAT on electricity. He says that while government imposes tax to fill up its coffers, the boom in business that would result from cheaper electricity would also lead to a financial windfall.

He also said the Electric Power Industry Reform Act (EPIRA) of 2001 was supposed to liberalize and reduce costs in the power sector. However, it did not address the issue of "overtaxation".

Abalos vowed to prioritize energy reform if elected to the Senate in the upcoming May 12 mid-term polls.

“This will be one of my first bills. Lowering energy costs will spur more businesses, more jobs, and better lives for Filipinos,” he said.

Abalos also called for more support for renewable energy, citing the country’s abundant yet underutilized natural resources. 

“Right now, we’re only using 18 to 21 percent renewables. In Nordic countries, it's over 50 percent—and it’s cheaper. We should invest more in renewable energy,” he said.