Home News Cagayan Valley Is the increased fare in Region 2 PUVs caused by TRAIN law?

Is the increased fare in Region 2 PUVs caused by TRAIN law?

TUGUEGARAO CITY, Philippines- Several commuters blamed the newly-implemented tax reform law as fare in public utility vans (PUVs) increased to more or less 100 percent.

But the Land Transportation Franchising and Regulatory Board (LTFRB) denied that the Tax Reform for Acceleration and Inclusion, also known as TRAIN law, has “direct correlation” on the new fare matrix of PUVs in Cagayan Valley.

According to LTFRB Regional Director Nasrudin Talipasan, there should be a recently approved fare hike on the basis of increased oil products due to the new tax law.

The process in approving fare hike included a petition among transport service providers asking the government transport regulators of a certain amount of increase. In this process, transport operators should justify their request, like the increased price of oil products.

This was not the case in the sudden surge of fare increase.

Talipasan said the transport operators just moved to “strictly follow” a LTFRB order in 2007, which set a P2 prescribed fare per kilometer. This made, for example, the fare from Aparri to Tuguegarao and vice versa from P100 to P204.

“Ang sagot po natin diyan ay scientifically, there is no direct correlation between the TRAIN law and the prescribed fare, because nauna nga ‘yung prescribed fare,” Talipasan said.

The LTFRB released the Memorandum Circular 2007-007 in February 2007. One of the provisions became the basis of the public transport providers in increasing the fare to more or less 100%.

“The provisional fare rates under this Comprehensive Program shall be Php2.00 per kilometer on a straight line computation which the board may modify upon petition of any party after compliance with the requirements of Notice and Hearing,” a provision of the circular read.


However, Talipasan said the timing of the implementation of the new fare matrix could be “inferred” with higher oil prices after the imposition of new taxes on fuel under the tax reform law.

The TRAIN law imposed excise taxes on oil products. The Department of Energy (DOE) had estimated that an additional P2.97 per liter will be imposed in gasoline, diesel with P2.80 per liter, kerosene with P3.36 per liter, Liquefied Petroleum Gas (LPG) for household with P1.12 per liter and LPG for vehicles with P2.80 per kilo.

“It is very timing with the implementation of the TRAIN law na tumaas nga ‘yung requirements ng pagpapatakbo ng isang negosyo sa transport. At dahil nakita ngayon ng ating mga transport groups na pupuwede nilang bawiin,” Talipasan said.

The LTFRB official also said the transport providers has to be blamed on the public’s negative reaction on the new fare matrix because they had been undercharging for more than 10 years.

“Kasi ‘yun (TRAIN law) ang pinakamadaling sagot na naiiintindihan ng ibang tao at ‘yan naman talaga ang talk of the town. And siguro, ayaw [ng mga transport providers na] sabihin na nagkasala sila noon,” he said.

Fare competitions down

Talipasan noted that the transport group also begun following the prescribed fare of P2 per kilometer as the government has succeeded in their crackdown against colorum vans.

He said this resulted to lesser fare competitions among passenger vans.

“At dahil nabawasan ang colorum vans, ay lumiit na lang yung competition. At dahil lumiit ‘yung competition ay hindi na kailangang babahan o mag-compete sila sa pababaan ng fare,” he added.

Talipasan also admitted that charging below the prescribed fare, also known as undercharging, is illegal, but he said they could not act on it because there was no proper complaint.

Under the law, undercharging passenger vans will be fined P5,000 for the first offense; P10,000 for the second offense; and P15,000 plus cancellation of franchise for the third offense. Northernforum.net

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