The Finance Department plans to launch early next month the fuel marking program to check oil smuggling that is costing the government P27 billion to P44 billion in annual revenue losses.
Finance Undersecretary Antonette Tionko said in a news briefing a team was currently testing the marker to be used for the program.
“The team that’s doing it is actually going already to the refineries. So that’s ongoing now. Hopefully by next month, February first week, we will launch it already,” Tionko said.
“Right now, they are testing the marker itself―the acceptability of the marker. So that’s with discussion with the DoE [Department of Energy], the DENR [Department of Environment and Natural Resources... so once it’s accepted, we will do our first marking,” Tionko said.
Under the program, the fuel marking providers―SICPA SA of Switzerland and SGS Philippines―are expected to provide a unique chemical marker capable of being embedded at a molecular level to petroleum products such as gasoline, diesel and kerosene.
Their contract covers services and equipment necessary to administer and inject the marker to the fuel and the administration of confirmatory tests, both in the field and in laboratories.
Finance Secretary Carlos Dominguez III earlier directed DoF officials involved in the implementation of the project to coordinate with Customs commissioner Rey Leonardo Guerrero.
The joint venture of SICPA SA and SGS Philippines already submitted a masterplan to implement the fuel marking program.
The Bureau of Customs and the Bureau of Internal Revenue also drafted the implementing rules and regulations which would be matched with the masterplan.
The BoC would be the lead agency to implement the program under the Tax Reform for Acceleration and Inclusion Act.
The Finance Department said the government lost potential revenues of P26.87 billion from smuggled or misdeclared fuel in 2016.
The Asian Development Bank’s estimate was higher at P37.5 billion while a study commissioned by the local oil industry placed the foregone revenues at P43.8 billion.
The Institute for Development and Econometric Analysis said “smuggled gasoline accounted for an average of 23 percent of gasoline consumption from 2000 to 2006,” while “smuggled diesel accounted for an average of 6 percent.”
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