Metro Manila (CNN Philippines, October 28) — A party-list lawmaker called on the Department of Finance (DOF) to reconsider its position on the proposed suspension of the excise tax on fuel products.
During a hearing of the House Committee on Energy Thursday, Bayan Muna Rep. Carlos Zarate slammed the DOF for its firm objection to the suspension of the oil excise tax.
“It’s very unfortunate na i-shut [off] agad ‘yung proposal na ‘yan,” he said.
[Translation: It’s very unfortunate that they immediately shut the proposal off.]
“I hope the Department of Finance and the economic managers will reconsider their position,” Zarate added.
His statements came after DOF Strategy, Economics, and Results Group Director Euvimil Nina Asuncion said the agency is opposed to the idea as this may “translate to significant foregone revenues.”
She also warned that suspending the excise tax on petroleum products will be “detrimental” to the economic recovery of the Philippines.
The DOF added there is a need for new legislation to suspend excise taxes since Republic Act 10963 or the Tax Reform for Acceleration and Inclusion (TRAIN) law only covered oil excise hikes from 2018 to 2020.
Excise tax on petroleum products took effect in three tranches from 2018 to 2020 — increasing duties to ₱10 per liter for gasoline, ₱6 per liter for diesel, ₱5 per liter for kerosene.
The DOF earlier said the government will lose ₱131.4 billion in 2022 if a suspension will be imposed for a year.
“The better and more equitable way to address the impact of increasing fuel prices is to provide targeted support to the vulnerable sectors,” Asuncion said.
While providing a subsidy to affected drivers is a “welcome move,” Zarate said it is still not enough as the impact spills over to other sectors.
“Paano ‘yung mahihirap na kababayan natin na apektado nitong domino effect nang pagtaas ng oil products?” he said.
[Translation: How about our poor countrymen who are affected by the domino effect of these oil price hikes?]
Transport groups earlier urged the government to implement fare hikes amid rising pump prices. Transportation chief Arthur Tugade rejected the idea, but vowed to provide assistance to affected drivers and operators.
The government has committed to releasing ₱1 billion in cash aid for public utility vehicle drivers. Asuncion said 178,000 drivers will be covered by this, where each driver will receive about ₱5,000.
