by Xave Gregorio – Philstar.com, 29 Oct 2021
MANILA, Philippines — House Deputy Speaker Rufus Rodriguez filed Thursday a bill seeking to suspend from 2022 to 2025 the imposition of excise taxes on fuel based on the Tax Reform for Acceleration and Inclusion (TRAIN) law.
House Bill No. 10246 proposes that the government collect excise taxes on fuel from Jan. 1, 2022 to Dec. 31, 2025 based on the rates provided under the National Internal Revenue Code before it was amended by the TRAIN law.
If passed into law, this means that excise taxes on regular gasoline and unleaded gasoline will drop to P4.35 per liter and P5.35 per liter, respectively, while excise taxes will not be imposed on diesel, kerosene and liquified petroleum gas (LPG).
The TRAIN law currently imposes a P10 per liter excise tax on gasoline, P6 per liter on diesel, P5 per liter on kerosene and P3 per kilogram of LPG. An additional 12% value added tax (VAT) is imposed on top of excise taxes.
Fuel prices have been increasing for eight consecutive weeks as global demand for oil picks up, prompting calls from some lawmakers and transport groups to slash excise taxes.
“One way to help the Filipino people is to temporarily suspend the collection of excise tax on fuel products based on the increased rates as provided by the TRAIN law until the country has fully recovered from the COVID-19 pandemic,” Rodriguez said in his explanatory note.
The Department of Finance (DOF), however, has rejected these proposals, telling House lawmakers on Thursday that the government stands to lose P147.1 billion in a year should excise tax and VAT on fuel be suspended.
The DOF is proposing to provide quick and targeted support to vulnerable sectors instead as a response to rapidly rising fuel prices.