The government’s two main revenue collecting agencies marked a total of 3.21 billion liters of petroleum products under the fuel marking program as of Feb. 14, Finance Secretary Carlos Dominguez III said over the weekend.
Data from the Finance Department showed that of the total, the Bureau of Customs marked 2.368 billion liters while the Bureau of Internal Revenue accounted for 913 million liters.
Among the oil companies that participated in the program are Unioil, Chevron, Phoenix Petroleum, Seaoil, Shell, Insular Oil, Filoil Energy, PTT, Petron, Warbucks Petroleum, Microdragon Petroleum (Subic), High Glory Subic International, Marubeni Philippines (Subic), Goldenshare Commercial (Subic), Jadelink (Subic) and Era1 Petroleum (Subic).
The fuel marking program aims to address the proliferation of smuggled fuel in the country. This involves the injection of chemical indicating correctly paid excise taxes and import duties.
Dominguez said last year that the implementation of the fuel marking program would help address the expected rise in fuel smuggling in the wake of the increases oil taxes under the Tax Reform for Acceleration and Inclusion Law or TRAIN law that took effect in January 2018.
Dominguez said the government anticipated the potential increase in smuggling with higher excise taxes and therefore initiated the fuel marking program which was designed to help address the issue.
He said this was a strong indicator of increased compliance, and “those who skirted required declarations and payment of taxes in the past are now following the law.”
Dominguez said the implementation of the fuel marking program was expected to boost government revenues by at least P5 billion.
He said at least 95 percent of all marking sites would be operational by the end of 2019.
Data showed that in 2016, lost revenues from excise taxes and value-added tax due to oil smuggling and misdeclaration reached P26.9 billion, more than half of the actual P52.6 billion collected by the
Bureau of Customs and BIR that year.
The Asian Development Bank had a higher estimate of P37.5 billion in lost tax revenues yearly because of oil smuggling.
A separate study commissioned by local oil industry players estimated that revenue losses because of oil smuggling reached as high as P43.8 billion annually.
