More than 270 retail stations implemented the second tranche of the Tax Reform for Acceleration and Inclusion law for petroleum products as of Jan. 5, the Energy Department said Monday.
This developed as oil companies also implemented higher oil prices of P0.80 per liter for gasoline, P0.70 per liter for diesel and P0.40 per liter for kerosene effective Tuesday 6 a.m.
Energy Undersecretary Felix William Fuentebella said 268 stations implemented the higher excise tax for gasoline and diesel at P2.24 per liter (including value added tax) as of Jan. 5, but the number increased by an additional six stations in the morning of July 7.
“It’s a moving target,” Fuentebella said, adding the department took measures to prevent abuse and ensure fair and effective implementation of the taxation scheme.
The retail stations which began implementing the higher excise tax were Petron Corp. and Flying V mostly in the Luzon area. These stations comprised about 3 percent of the 8,006 retail stations nationwide.
“The Department of Energy is mandated to ensure that the pricing of oil products is carried out within the parameters of the Train Law,” Energy Secretary Alfonso Cusi said in a statement.
“Over the process of the implementation of the first tranche of the Train law, we have reached out to our stakeholders, especially the oil companies for their cooperation and we will continue our coordination with them throughout the second tranche,” Cusi said.
He said the department would be more vigilant in monitoring the implementation of the second tranche of the Train law for petroleum products.
“We will ensure the fuel stocks for 2018 will be utilized first and sold at the pre-implementation prices,” Cusi said.
Under the second tranche of Train law’s implementation, an additional excise tax of P2 will be imposed per liter of diesel and gasoline and P1 per kilogram on cooking gas or LPG (excluding value added tax).
The agency said the increase in pump prices of petroleum products resulting from the imposition of the second tranche of fuel excise tax would still be smaller because of the offsetting effect of the rollbacks implemented last year and January 2019.
Cusi said while there was an uptick in the price of oil in the world market recently, the industry was not expecting crude oil prices to hit record high prices seen in October 2018 when Brent crude oil price breached the $80-per-barrel level.
World oil prices reacted to Saudi Arabia’s move to cut actual production to support higher oil prices.
“If the trend continues, we do not expect it to have as much impact on fuel prices as it did last year. Besides, we can cushion the effect of any new oil price increases by becoming more efficient in our use of energy,” Cusi said.
Cusi said the higher excise tax on oil would be a “little sacrifice [that] would translate to huge benefits for the country.”
“Let us remember that the revenues from Train will fund important programs, such as free education, increase in the salaries of our public school teachers, as well as crucial infrastructures under the ‘Build, Build, Build’ program. All these would sustain our economic growth towards Ambisyon 2040 by providing more jobs and livelihood opportunities for our people,” Cusi said.