In a press conference in Malacañang, Favila said the assurances were given to him during a series of meetings with manufacturers’ associations and market leaders over the past weeks.
"Barring unusual and sudden movements in the prices of key manufacturing components, they said there would be no dramatic increases, even with the implementation of the 12-percent VAT" in 2006, he said. "We continue to keep a daily monitoring on the behavior of the prices in all regions of the country."
He said he met with various associations and manufacturers of flour, milk and dairy products — including Nestle and Alaska, coffee, sardines and processed meat.
According to him, raw and unprocessed foods and other basic commodities would remain VAT-exempt.
Some manufacturers, however, expressed concern over the 70-percent cut in the creditable VAT that they said would eat into their revenues, Favila added.
He urged consumers to buy goods in public markets, where prices are lower, adding that the government continues to implement other means of protecting the poor, including strict price monitoring.
With the 24-hour, one-stop price monitoring center set up by the Department of Trade and Industry (DTI), the government has been leaning harder on traders not to make undue price increases.
The Supreme Court last week declared the VAT Reform Law constitutional, but has not yet lifted the temporary restraining order (TRO) on its implementation following a petition from the opposition for the court to declare the amended tax measure unconstitutional. — Paolo Romero