A LEADER of the House of Representatives is pushing for the passage of a measure suspending the collection of the increase in excise taxes on gasoline, diesel and other oil products for four years.
Deputy Speaker Rufus Rodriguez said his House Bill 10246, which he filed last October 29, 2021, seeks to suspend excise tax increase on oil products from 2022 to 2025.
Under the measure, only the excise tax adjustments imposed in Section 43 of Republic Act No. 10963, or the Tax Reform for Acceleration and Inclusion (TRAIN) Law would be suspended.
Rodriguez noted that for the past eight weeks, the price of unleaded gasoline went up by P7.20 per liter and diesel by P8.65 per liter.
He said prices of unleaded gasoline and regular diesel in Metro Manila are now around P70.44 and P50.17 per liter, respectively; while in the Visayas, unleaded gasoline costs P73.96 per liter and diesel sells for P64.95 per liter.
In Mindanao, he said unleaded gasoline retails for P74.85 per liter and diesel for P70.65 per liter.
Once the suspension takes effect under the bill, the government would continue collecting excise levies on oil products based on the old rates contained in the National Internal Revenue Code.
According to the lawmaker, Section 43 includes a suspension provision covering the period 2018 to 2020 whenever crude oil prices exceeded $80 per barrel.
“Unfortunately, the provision for the suspension of the increase of excise taxes can only be applied until 2020. Then the Covid-19 pandemic happened. Jobs were lost, businesses closed and the economy suffered,” he said.
He said at present, the economy is only starting to gradually reopen and people are beginning to go back to work.
However, the weekly increases in the pump prices of oil products are adding to the people’s suffering, he added.
He said the increases in pump prices cause a domino effect on the prices of consumer goods, bringing more suffering to the people.
“One way to help the Filipino people is to temporarily suspend the collection of the increase in excise taxes on oil products imposed under the TRAIN Law until the country has fully recovered from the Covid-19 pandemic,” he said.
Rodriguez added that once the adjustments are suspended, the old rates that would apply would be P4.35 and P5.35 per liter on regular gasoline and unleaded gasoline instead of the present P10, while diesel, kerosene and liquefied petroleum gas would not be imposed any excise tax.
The suspension should result in a corresponding decrease in the prices of consumer goods and services, he said.
DOE authority
Meanwhile, in a recent meeting of the House Committee on Energy, Deputy Majority Leader Juan Miguel Macapagal Arroyo said giving the Department of Energy the authority to suspend the excise tax on oil would affect the country’s revenue generation, thus the need to confer with the Department of Finance (DOF).
The panel held a briefing last week on the implications of the proposed suspension, as well as a review on the provisions of Republic Act 8479 or the Downstream Oil Industry Deregulation Act of 1998.
Aimed at easing the burdens of Filipinos amid the rise in oil prices in the global market, DOE Oil Industry Management Bureau Director Rino Abad recommended amending Section 43 of RA 10963 of the TRAIN Law to allow the suspension of excise tax on petroleum products.
Abad also discussed the DOE’s proposed amendments to RA 8479, including adding a security of supply provision and mandating oil companies to submit unbundled weekly price adjustment and pump price. But DOF Strategy, Economics, and Results Group Director Euvimil Nina Asuncion objected to the proposed suspension of excise tax.
Asuncion said it would be detrimental to the country’s economic recovery and long-term growth.