Oil tax freeze mulled; belt tightening pushed

President Rodrigo Duterte said he may suspend excise taxes on oil and petroleum products even as the Department of Energy urged people to tighten their belts Tuesday and adopt fuel-saving measures as the country weathers eight consecutive weeks of rising fuel prices.

“Maybe,” the President said when asked if suspending excise taxes under the Tax Reform for Acceleration and Inclusion Law was an option.

He said Finance Secretary Carlos Dominguez is already studying the proposal.

READ: SAP clarifies oil tax freeze may lead to P40-billion revenue loss

Under the TRAIN Law, the suspension can only be done if the price of oil stays at $80 for three consecutive months.

But Senate Minority Leader Franklin Drilon said the President, backed by a joint resolution from Congress, can suspend the higher excise tax on petroleum products. 

The DOE, for its part, said the government is doing everything it can to address the problem.

“You are not alone in facing this,” the Energy department said in a statement.

“Your full cooperation is needed in facing the challenges ahead. Now more than ever, we are appealing for each and every one of us to adopt simple yet far-reaching changes in the energy choices we make, with efficiency at its core.”

Using fuel wisely is “one easy way” for Filipinos to cope with the incessant increases in the cost of oil and petroleum products, the department said.

“For example, planning one errand day for the entire family is a creative way which allows us to spend more time with our loved ones while decreasing the number of trips we need to make,” the department said.

“Helping bring down the overall energy demand of our country is hinged upon our energy habits. Simple tasks such as turning off appliances that are not in use become second nature when done repeatedly. In addition, switching to LED lighting and inverter technology significantly reduces our power consumption, which means lower electricity bills.”

In the Senate, Senator JV Ejercito called for the suspension of the second round of excise taxes on fuel, which are due to kick in in January 2019. “I urge our economic managers to be sensitive to the plight of Filipino families who are struggling with skyrocketing inflation and unabated fuel price hikes,” Ejercito said in a statement released Tuesday.

He argued that whatever purchasing power was added to Filipino consumers by virtue of the decrease in income tax under the TRAIN Law has been obliterated by a nine-year high 6.7 percent inflation rate in September and oil price increases for eight consecutive weeks.

“I believe it’s time to give Filipino families a break. Defer the second round of increase in excise taxes on fuels scheduled to kick in this January 2019. At the very least, this will give our people a breather from spiraling prices of goods,” Ejercito said.

Under the law, the excise tax on diesel is scheduled to go up to P4.50 in 2019 while gasoline will increase to P9 at the start of next year. 

Topics: Rodrigo Duterte , Department of Energy , Tax Reform for Acceleration and Inclusion Law , Carlos Dominguez
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