27/02/2022
LAWMAKER RENEWS CALL TO SUSPEND OIL EXCISE TAX HIKES
Amid the exponential increase of oil prices, House deputy speaker and Cagayan de Oro Rep. Rufus Rodriguez urged again the government to suspend the collection of the increase in excise taxes on gasoline, diesel, and other oil products for three years, from 2022 to 2024.
Currently, the excise tax for gasoline with 91 Research Octane Number (RON) and below, and above 91 RON is valued at P10/liter. Excise cuts allow taxes to be reduced to P4.35/liter and P7/liter respectively.
Other petroleum products such as Kerosene, Diesel, and LPG with a regular excise tax of P5/liter, P6/liter, and P3/liter respectively, will bear zero excise tax once the proposal is approved.
The Department of Energy (DOE) reported that oil prices in the past two months stood at a net increase of P7.95/liter for gasoline, P10.20/liter for diesel, and P9.10/ liter for kerosene.
Under HB10246 (substituted by HB10488) filed by Rodriguez in October 2021, only the excise tax adjustments imposed in Section 43 of Republic Act No. 10963, or the Tax Reform Acceleration and Inclusion (TRAIN) Law would be suspended.
Once the suspension takes effect, the government would continue collecting excise levies on oil products based on the old rates contained in the National Internal Revenue Code.
”Our transport sector is affected. The jeepney, taxi, and motorela drivers in Cagayan de Oro City are complaining and are pushing for a fare hike. When this happens, prices of consumer goods and services will also increase, bringing more suffering to the people,” Rodriguez said.
“It is important to also note that the Philippine economy is still recovering from the COVID-19 pandemic. So, suspending the collection of the increase in excise taxes on oil products imposed under the TRAIN Law will result in a corresponding decrease in the prices of goods and services,” he added.
Rodriguez also warned that a further increase in oil prices is possible due to the escalating tension between Russia and Ukraine.
In 2019, DOE reported that Russian oil is the third-largest crude oil import in the Philippines.
“With the sanctions imposed by the US and other powerful countries, we have to respond proactively to the expected increase of goods and services brought by the tight supply of oil,” he added.
