Leaves matter to Marcos administration
The Palace this week refused to suspend the collection of excise taxes on oil products to provide relief to consumers struggling under the weight of constantly increasing fuel prices, saying it would leave it to the incoming Marcos administration to address the problem.
“We will leave it up to the next administration to decide on these calls to suspend the excise tax on fuel,” acting presidential spokesperson and Communications Secretary Martin Andanar said in a Palace press briefing Tuesday.
Andanar said President Rodrigo Duterte has not changed his mind about rejecting proposals to suspend the excise tax on fuel products.
In March, Duterte instead approved the recommendation of the Department of Finance to provide direct aid to the most vulnerable sectors, allocating P33 billion for unconditional cash transfers to poor families.
Under this cash aid, qualified households would receive P200 a month or a total of P2,400 as aid.
Citing Finance Secretary Carlos Dominguez III, Andanar said the excise tax on oil products must be retained because the amount has been budgeted for salaries of school teachers; “Build, Build, Build” infrastructure program; and other expenses.
Dominguez earlier warned that suspending excise taxes on fuel products would force the government to borrow money and result in P105.9-billion revenue losses in 2022 or around 0.5 percent of the country’s gross domestic product this year.
The administration of Marcos is also against suspending excise taxes on fuel products anytime soon.
In an interview over CNN Philippines’ The Source, Bangko Sentral ng Pilipinas Governor and Finance chief-designate Benjamin Diokno said cutting taxes on fuel would be a “wrong move” at this time.
President-elect Ferdinand Marcos Jr. said there are other ways to address the rising costs of fuel aside from suspending excise tax on oil products.
He also said he may reconsider the proposal, however, should there be a study showing that removing excise taxes on fuel products would be beneficial.
An opposition lawmaker on Tuesday said measures that will immediately ease the economic burden of Filipinos should be top priority of the next Congress.
Gabriela party-list Rep. Arlene Brosas made the statement as another huge oil price hike was imposed Tuesday and as the government announced that inflation in May was the highest in three years.
“We will prioritize the scrapping of excise taxes on petroleum products through amendments to the Tax Reform for Acceleration and Inclusion (TRAIN) Law as well as the removal of other regressive taxes on consumption goods. Fuel subsidies are insufficient in easing the oil price shock that we are experiencing right now,” Brosas said.
She added that the renewed push for Charter Change should never be a priority of the incoming 19th Congress.
The Gabriela lawmaker said foregone revenues from the removal of oil excise taxes could be offset by the implementation of a wealth tax on super-rich Filipinos.
“Estimates by IBON Foundation have shown that imposing a 1-3 percent wealth tax on the richest families could generate P467 billion – which is more than enough to offset the oil excise taxes,” Brosas said.
The Department of Energy (DOE) said pump prices are unlikely to reach P100 per liter despite the ongoing Russian invasion of Ukraine.
“We are seeing that prices will go up and down. There are factors which would reflect fluctuation, where even if prices will move under existing circumstances, it will not reach P100 per liter,” Gerardo D. Erguiza, Jr., DOE assistant secretary, said during a briefing.
“As they said, what goes up must come down. It will eventually go down,” Erquiza said.
Erquiza said the strong global demand for oil products increased world oil prices and urged the public to conserve energy.
Based on the latest monitoring of the DOE, pump prices have not reached P100 per liter, although some oil companies sell gasoline at a high of P90 per liter.
PetroGazz announced it would roll back its diesel prices by P3.50 per liter from 6 am June 8 to 10 pm June 11 at selected stations nationwide.
PetroGazz said the price cut is a company initiative to help the transport sector cope with the rising fuel prices.