Former Energy Secretary Vincent S. Perez, who came from speaking engagements in the United States, told reporters that "institutional investors in the United States were following closely the congressional deliberations on the VAT bill and silently applauded the passage of the VAT law as a crucial step in the restoration of the fiscal health of the country."
Perez, who now sits as a director in Philippine National Bank, also commended Congress for showing its political will in passing the VAT law with zero-rated VAT for renewable energy.
The former energy official, who resigned from his post last March, described the passage of the VAT law as a watershed in the political maturity of Congress in passing an urgent, critical, albeit unpopular tax measure.
"The VAT law was one of the most difficult legislative decisions that Congress has had to make in recent years, and we must recognize that Congress has shown its political maturity in passing what is generally very unpopular measure," he said.
According to Perez, the VAT exemption or zero-percent VAT rating for the sale of power or fuel generated through renewable sources will boost this particular sector of the power industry.
Renewable energy include biomass, solar, wind, hydropower, geothermal, ocean energy and other emerging energy sources using technologies such as fuel cells and hydrogen fuels.
Perez said this exemption is crucial in promoting this kind of energy sources.
For the Department of Energy’s part, he said the DOE had already launched in May 2003 a comprehensive Renewable Energy Policy Framework.
The framework, he said, was cited as one of the best national renewable energy policies at the May 2004 Ministerial Conference on Renewable Energy held in Germany.
"We hope that more players will invest in developing our untapped renewable energy resources to increase our energy self-sufficiency and advance our march towards energy independence," he said.