Metro Manila, Philippines – President Ferdinand Marcos Jr. has temporarily suspended excise taxes on liquefied petroleum gas and kerosene to provide relief to consumers as global crude oil prices remain high.
Marcos signed Executive Order 125 on Friday, Sept. 25, after the average price of the benchmark Dubai crude climbed to $99.41 per barrel over the preceding 30 days.
“The excise taxes on LPG, except when used as raw material for production of petrochemical products or used for motive power, and kerosene, except when used as aviation fuel, are hereby fully suspended,” the order stated.
The removal of the tax is equivalent to ₱3.36 per kilogram, or nearly ₱37 for a standard 11-kilogram cylinder.
For kerosene, the suspension removes ₱5.60 per liter from the tax component.
Actual retail price adjustments may vary depending on the existing inventories and pricing decisions of suppliers and retailers.
The Development Budget Coordination Committee recommended the suspension after the Department of Energy certified that Dubai crude had breached the price threshold set under the law.
The DOE said the average Dubai crude price from August 13 to September 11 reached $99.41 per barrel, exceeding the $80 threshold for the government to consider reducing or suspending fuel excise taxes.
Based on the reviews, the DBCC may recommend that Marcos continue, modify, extend or end the suspension.
The DOE, Department of Finance, Bureau of Internal Revenue and Bureau of Customs were also directed to inventory existing LPG and kerosene stocks upon the order’s effectivity.
The inventory is intended to distinguish stocks purchased before the tax suspension from new supplies covered by the order.
Arnel Ty, president of LPG supplier and distributor Republic Gas Corporation, said at the weekend that based on monitoring, the price of cooking gas is expected to increase in October due to tight supply and high demand amid an escalating conflict in the Middle East.
