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Grab Wants Price Hike Because Of New Tax Law

Expect higher prices if their petition is granted

Transport network company Grab wants a fare hike of around six to ten percent to offset the cost of higher operating expenses because of the recently approved Tax Reform for Acceleration and Inclusion (TRAIN) law.

The government’s tax reform package will increase the fuel excise tax, which will in turn increase the operating expenses of its drivers.

“We will file a petition with the LTFRB (Land Transportation Franchising and Regulatory Board (LTFRB) to request for a fare change,” Grab Philippines head Brian Cu said.

“Now, we are still computing the exact impact of that fare change, but we are looking at a fare increase of anywhere between 6% to 10% of current fares,” he added. That translates to approximately Php 10 to 13.

Cu says that an average driver consumes an average of Php 800 to 1,000 worth of fuel a day, which is around 20 to 22 liters. That amount will increase once the higher excise taxes are applied, which will increase a driver’s operating expense. Grab drivers typically make around Php 3,200 to 3,600 a day in fares without fuel costs factored in.

“Because of excise tax on petroleum products, this would definitely impact their daily expenses, which would then impact their monthly earnings,” Cu said.

“Our biggest worry is the day to day operations with regards to the fuel they (drivers) need. If a fare adjustment is not made, this would put into question their income on a monthly basis,” he said.


John Nieves

John is a veteran technology and gadget journalist with more than 10 years of experience both in print and online. When not writing about technology, he frequently gets lost in the boonies playing soldier.

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