Excise Tax Hikes Could Push 2027 Inflation to 4.5%, Says Chinabank Research

An increase in excise tax on sweetened beverages, alcohol, and tobacco could push inflation to as high as 4.5 percent in 2027, according to Chinabank Research’s latest commentary. The tax hikes, which are being considered by the government, are expected to add to price pressures as the country continues to grapple with the fallout from the oil shock. The proposed increases aim to boost government revenue and improve public health, but concerns are rising about the potential burden on households. The Philippine economy is in the midst of recovery from the pandemic, with inflation control being a key policy objective. Rising prices for food and energy, in particular, have significantly impacted low-income households. Excise tax hikes could further strain their disposable income. Geopolitical tensions surrounding the South China Sea and foreign investment trends also contribute to the uncertainty in the Philippine economy. The government faces a challenging task of balancing economic growth with price stability. Information Source: Inquirer Business