Groups seek removal of fuel excise tax

MANILA, Philippines — Transport and business groups want the removal of excise tax on fuel, to give both businesses and consumers some “breathing space” in the face of rising prices of goods.

In an interview with “Storycon” on One News yesterday, Philippine Chamber of Commerce and Industry (PCCI) chairman emeritus George Barcelon said they expect higher costs for manufacturing, logistics and consumer goods after diesel prices surged by as much as P24.50 per liter.

Transport groups also called for the removal of excise tax and value-added tax on fuel.

PISTON president Mody Floranda said sparing public utility drivers from P6 per liter excise tax on diesel and P9 from VAT would be a great relief.

PARA Commuters’ Network convenor Nanoy Rafael labeled these taxes as “regressive” because even those who are poor or those who don’t have any income are affected by the tax increase.

“It is necessary to immediately remove the excise and value added tax to avoid oil price shock,” he said.

Barcelon said the removal of the excise tax on oil “is primarily to mitigate the impact of the high price.”

He acknowledged that the tax is also an important revenue source for the government.

Barcelon said the conflict between Iran and the US-Israel alliance has greatly disrupted global trade routes and transportation, creating uncertainty that businesses have found difficult to navigate.

“The shorter the conflict, the better. When uncertainty drags on for a long time, it becomes very hard for businesses,” Barcelon said.

Congress, meanwhile, has taken a step toward easing the impact of the Middle East crisis on Filipinos, with the approval yesterday by the House committee on ways and means of a substitute bill authorizing President Marcos to suspend or reduce excise taxes on petroleum products.

The measure consolidates 15 bills and two joint resolutions, including House Bill (HB) No. 8292 filed by Speaker Faustino Dy III and Ilocos Norte Rep. Sandro Marcos, seeking to grant the President temporary authority to suspend fuel excise taxes during national or global economic emergencies.

It also incorporates HB No. 5779 filed by former speaker and Leyte Rep. Martin Romualdez, seeking to remove the excise tax on fuel by amending Republic Act 10963, or the Tax Reform for Acceleration and Inclusion (TRAIN) Law.

The Senate is set to tackle today bills seeking the automatic suspension of taxes on petroleum products and granting the President emergency powers to reduce or suspend taxes on petroleum products.

Sen. Pia Cayetano, as chairperson of the ways and means committee, will lead the joint hearing with the energy committee, which she also chairs.

President Pro Tempore Panfilo Lacson said he and his colleagues would give “utmost priority” to the President’s request for emergency powers.

“Only those who do not want to help alleviate the suffering of ordinary Filipinos brought about by the uncontrolled increase in the prices of oil in the aftermath of the raging Iran war would refuse to grant such emergency power,” Lacson said.

“In fact, the Senate is giving utmost priority to tackle the measure toward this end,” he added.

Different versions of the measure were filed by Sen. Pia Cayetano and her brother Alan Peter, JV Ejercito, Imee Marcos, Bam Aquino, Lito Lapid, Joel Villanueva, Erwin Tulfo, Francis Pangilinan, Francis Escudero and Loren Legarda.

No objection

Ways and means committee chairman and Marikina City Rep. Miro Quimbo declared the substitute bill approved after Manila Rep. Rolando Valeriano moved for its adoption, with no member of the committee raising an objection. The measure would be transmitted to the plenary for deliberation.

“An excise tax suspension or reduction will be a big relief to our people at this time of soaring fuel prices. A suspension would mean a retail price reduction of P6 to P10 per liter,” Romualdez said as he thanked the committee for approving the measure.

Bicol Saro party-list Rep. Terry Ridon also lauded the ways and means committee’s move.

“This new measure ensures that the nation will no longer have to wait for three months before government action can be undertaken on rising petroleum prices. Instead, it empowers the President to act swiftly during extraordinary circumstances, ensuring that the government’s response is immediate, responsive and attuned to the realities of the global energy market,” Ridon said.

Under the measure, which seeks to amend the National Internal Revenue Code, the President may suspend or reduce the excise tax on petroleum products upon the recommendation of the Development Budget Coordination Committee (DBCC), in coordination with the Department of Energy.

The authority may be exercised if the average Dubai crude oil price based on the Mean of Platts Singapore (MOPS) reaches or exceeds $80 per barrel for one month immediately preceding the suspension order.

It may also be triggered if the President declares a national emergency or calamity that results in extraordinary increases in domestic pump prices of petroleum products, as certified by the energy secretary. – Jose Rodeo Clapano, Marc Jayson Cayabyab, Delon Porcalla, Bella Cariaso, Josiah Antonio