REGASCO Seeks Excise Tax Suspension as Oil Prices Rise Above $100

 

The government is being urged to take immediate action to cushion consumers and the transport sector from another round of fuel price increases, with LPG industry leaders calling for the temporary suspension of petroleum excise taxes.

REGASCO and LPG Marketers Association President Arnel Ty said Dubai crude oil has climbed above $100 per barrel, a level that has intensified pressure on domestic fuel prices. The group has formally appealed to Energy Secretary Sharon Garin to recommend the suspension of excise taxes on LPG, kerosene, diesel and gasoline.

Ty said the measure could provide substantial relief if approved. Based on the industry's estimates, removing the applicable excise taxes could reduce LPG prices by about P3 per kilogram, diesel by P6 per liter, gasoline by P10 per liter and kerosene by P5 per liter.

The appeal comes as another fuel price increase is expected on Tuesday, September 15. International crude prices have continued to gain amid tensions affecting key shipping routes, particularly the Red Sea and the Strait of Hormuz. Depending on the latest adjustments, prices of some petroleum products could exceed P100 per liter at certain stations.

Philippine law already provides the national government with a mechanism to respond to sustained increases in global oil prices. Section 148 of the National Internal Revenue Code, as amended by Republic Act 12316, allows the president to suspend or reduce petroleum excise taxes upon the recommendation of the Development Budget Coordination Committee, in coordination with the Department of Energy.

The provision can be invoked when the one-month average price of Dubai crude reaches or surpasses $80 per barrel. Dubai crude is a key benchmark in Asia and is among the international oil price indicators that influence the cost of petroleum products in the Philippines.

The government has previously used this authority. In April, President Ferdinand Marcos Jr. issued Executive Order No. 114, temporarily suspending excise taxes on LPG and kerosene for up to three months.

For transport workers, however, the worsening fuel situation has already become an immediate economic concern. Transport group MANIBELA began a two-day strike on Monday, September 14, continuing through Tuesday, September 15, in protest of rising fuel costs.

The group also challenged earlier remarks from Garin that the government's ability to influence domestic fuel prices is limited because the Philippines relies heavily on imported oil.

MANIBELA argued that limited control over international prices does not eliminate the need for government intervention, particularly when higher fuel costs directly reduce the daily earnings of drivers and other transport workers.

With global crude prices remaining elevated, the debate is now centered on whether temporary tax relief can be deployed quickly enough to moderate the impact on motorists, consumers and the transport sector.