EDITORIAL
Dr. Tony Leachon has, yet again, published a dangerously misinformed and unfounded post on social media—this time calling for the resignation of Executive Secretary Ralph Recto over the government’s position on fuel excise taxes.
It is a serious accusation. It is also fundamentally flawed.
What we are seeing is a familiar pattern of loud conclusions, weak premises, and a complete disregard for how public finance actually works.
The claim that there was “obstruction” in suspending fuel excise taxes is simply false. There was no unilateral act by Executive Secretary Recto. Decisions of this magnitude are deliberated within the Development Budget Coordination Committee (DBCC), where economic managers collectively assess policy options based on data, models, and projections. The impact of suspending excise taxes is not guessed. It is quantified. Revenue losses, deficit expansion, additional borrowing requirements, and downstream effects on public spending are all laid out.
That is not obstruction. That is responsible, evidence-based economic governance.
What is even more misleading is the attempt to frame the current excise tax structure as if it were a recent invention of the present administration. It is not. The fuel excise tax regime being criticized today was institutionalized under the TRAIN Law, or Republic Act No. 10963, signed in 2017 by then President Rodrigo Duterte.
So the public deserves a straightforward question: why is there sudden outrage now over a tax framework that has been in place for years? Why was there no comparable condemnation when it was first implemented?
The inconsistency becomes even more apparent when one looks at the policy position taken during the Duterte administration itself. In 2022, when calls to suspend fuel excise taxes surfaced amid rising oil prices, the Department of Finance, then led by Carlos Dominguez III, took a clear stance against it. The reason was simple: suspending excise taxes would lead to significant revenue losses, widen the deficit, and increase borrowing requirements.
In short, the same fiscal logic being criticized today is the very same logic that the Duterte government recognized and defended. That reality cannot be ignored.
This brings the conversation back to fundamentals.
Cutting taxes without identifying replacement revenues is not compassion, but a fiscal decision with real consequences. When revenues fall but expenditures remain, the government does not magically create money. It borrows. Borrowing comes with interest. And interest payments do not exist in isolation. In reality, they crowd out funding for essential services such as education, healthcare, infrastructure, and social protection.
This is far from being a theory. This is the basic constraint of public finance.
Any serious economist understands that poorly timed, unfunded tax cuts can weaken fiscal stability, raise borrowing costs, and ultimately harm the very sectors they claim to protect.
Yet this nuance is conveniently ignored in favor of simplistic narratives. The framing that refusing tax cuts is “anti-poor” is utterly misleading and intellectually dishonest.
Economic managers do not reject tax cuts out of indifference. They do so because they are tasked with safeguarding fiscal sustainability. A destabilized budget does not help the poor. It limits the government’s ability to provide consistent, long-term support. Responsible governance requires balancing immediate relief with long-term stability. That balance is not easy, but it is necessary.
This is precisely why broad, across-the-board measures like cutting VAT from 12% to 10% are not automatically pro-poor. Without a financing plan, such proposals risk widening the deficit, increasing borrowing costs, and constraining future spending. Targeted interventions, those designed to directly assist the most vulnerable, are far more effective than sweeping but unfunded measures.
At its core, this is not about personalities. It is not about whether one supports or opposes Executive Secretary Recto. It is about whether one understands the consequences of weakening the government’s revenue base without a credible alternative.
The numbers do not adjust themselves to fit public sentiment. Fiscal realities do not bend to social media narratives.
Even in the face of global energy shocks, government action has not been blind or impulsive. Policy responses are studied, calibrated, and implemented through whole-of-government coordination. That is what competent leadership looks like in a crisis—not reactionary policymaking driven by headlines.
And yet, sadly, the same lazy argument keeps resurfacing: that every refusal to adopt a popular but fiscally costly proposal is somehow anti-poor.
It is not.
Serious economic management is not about saying yes to every headline-friendly idea. It is about asking the difficult but necessary questions:
How much revenue will be lost?
How much more will the government need to borrow?
At what cost?
And which programs will suffer if fiscal space deteriorates?
These are not rhetorical questions. They are the foundation of responsible policymaking.
What is truly concerning, however, is the casual use of strong accusations without evidence. Claims of “betrayal of public trust” and “obstruction” are not minor criticisms. They carry weight. When made without verifiable, policy-level analysis, they cease to be advocacy and become misrepresentation.
Public discourse, especially on economic policy, demands rigor. It demands discipline. It demands intellectual honesty.
So before calling for resignations, perhaps the more responsible approach is to do the homework first. Read the law. Study the numbers. Understand the deficit trajectory. Examine the borrowing implications. And recognize that the very tax framework being criticized today, along with the fiscal arguments used to defend it, has been consistent across administrations.
At a time when misinformation spreads rapidly and shapes public perception, Dr. Leachon must remember that words, narratives, and accuracy matter.
Spreading unfounded claims misleads the public and undermines trust in institutions. That is harmful and extremely irresponsible.
Accountability is not a one-way street. Those in government must answer for their decisions, but so must those who make sweeping public allegations without basis.
At the end of the day, the Filipino people deserve better than sound bites. They deserve better than outrage dressed up as expertise.
They deserve facts. They deserve discipline. And they deserve a level of discourse that reflects the seriousness of decisions that affect the entire economy.
All of us do.