According to Roxas, chair of the committee on trade and commerce, the greatest impact of the EVAT will be on liquified petroleum gas (LPG), unleaded gas, and diesel fuel.

"The LPG will increase to about R35. while unleaded gas will increase by 8.4 percent or from R36.05 per liter to R39.08," he said.

Moreover, electricity costs are also expected to rise with industries cornering the biggest hike in terms of cost per kilowatt hours.

The impact of new electricity rates on the industries, according to Roxas, could have a crippling effect as companies could opt to close shop or retrench personnel to keep up with the rising cost of power.

"The seven peso increase per kilowatt hour on industries could have an impact on job generation," he explained.

Moreover, the VAT will take its toll on heavy residential power users with a projected P0.69 per kilowatt hour increase for users breaching the 500 kilowatt/ hour mark each month.

"Clearly, the ones to be hit more are the middle class," said Roxas.

Roxas explained that the middle class will be hit the hardest by the VAT because they are the ones using airconditioners and freezers in their homes and using unleaded gas in their cars.

But while the middle class will be heavily hit by the tax measure, Roxas assured that the poor will experience a minimal effect of the VAT.

This is so because the VAT on power will be increased according to actual power usage.

Petron Philippines and energy officials reported that world prices of petroleum products have been stable the past few days following the recovery of the United States from hurricane Katrina.

Because of this, the Department of Energy (DoE) expressed optimism that gasoline prices will hike to seven percent, not ten percent, as the VAT law takes effect Nov. 1.

"We expect a price lowering for gasoline and possibly a roll back of the prices," said Virginia Ruivavar, public affairs manager of Petron Philippines.

Ruivivar explained that oil firms have already recovered loses during the past few weeks which saw a stabilizing of prices of oil products in the world market.

She assured that if this trend continues, Petron will roll back its prices and that the impact of the VAT on oil will be manageable, except for diesel which will rise as the coming winter months loom.

However, officials oil firms Shell, Caltex and Total Philippines expressed a scenario different from the projection of DoE and Petron.

According to these firms, they have yet to recover losses incurred during the past months and that the DoE data may have overlooked this fact in their computation.

Meanwhile, Roxas warned market vendors from indiscriminately increasing the prices of commodities and taking advantage of the situation because they will not be hit as hard as the others.

Trade undersecretary Zenaida Maglaya reported that her office has already confiscated 39 weighing scales from Muñoz and Tatalon markets for jacking up the prices of their products and using defective scales.