Garin clarifies Marcos VAT cut on electric bills applies only to systems loss

The administration is clarifying that President Ferdinand Marcos Jr.Philstar Biz reported that the VAT cut on electric bills ordered by the President is limited to the systems loss charge, not the entire bill.

In a statement, an official explained that the removal of the 12% value-added tax applies only to the systems loss component, which covers electricity lost during transmission and distribution. Other charges on the bill, such as generation, transmission, and distribution charges, will still be subject to VAT.

The clarification aims to address confusion among consumers who expected a broader reduction in their power bills. The limited VAT cut is expected to provide modest relief, as systems loss typically accounts for a small fraction of the total electricity cost.