Marcos signs law on fuel excise tax options

Metro Manila, Philippines –  President Ferdinand Marcos Jr. has signed into law a measure allowing him to suspend or reduce excise taxes on fuel products as a temporary relief to soaring costs.

Republic Act 12316 grants the president authority to temporarily cut or suspend excise taxes on fuel on specific conditions, including a sustained high global oil price.

That prerogative may be exercised when the average price of the benchmark Dubai crude oil reaches at least $80 per barrel over a prescribed period.

The suspension or reduction is for a limited period, subject to review and possible extension depending on market conditions. It also requires coordination among key agencies, including the Department of Energy (DOE), Department of Finance, and the Development Budget Coordination Committee, to assess the economic impact and recommend whether to continue or lift the tax adjustment.

The DOE will  monitor global oil prices and submit regular reports, while revenue agencies will make sure the law is properly implemented and complied with.

The law sets safeguards against market abuse, requiring authorities to monitor hoarding, price manipulation or other market distortions during the period of tax suspension or reduction.

In a national address, Marcos said the measure would give the government more flexibility in responding to volatile fuel costs.

“Ngayon, titingnan natin kailan ang pinakamagandang oras… because there are conditions within the law that have to be satisfied,” he said.

[Translation: Now we will determine the best time to use it… because there are conditions within the law that must be met.]

The president declared an “energy emergency,” describing it as a targeted response to risks in fuel supply and pricing rather than a broader national crisis.

“Malinaw ang salitang ginamit natin – ‘energy emergency.’ Hindi ito emergency ng pangkalahatan. It is a very specific and a very precise emergency,” Marcos said.

[Translation: The term we used is clear – ‘energy emergency.’ This is not a general emergency. It is a very specific and precise emergency.]

He said the declaration allows the government to act faster, including securing fuel and coordinating agencies under one command.