Gov't urged to suspend fuel excise tax; 11th oil price hike looms

An oil industry player is urging government to suspend fuel excise taxes as pump prices are set to increase for an 11th straight week. 

• DOE predicts 11th week of oil price hikes

Atty. Jesus "Bong" Suntay, Cleanfuel Group of Companies president, said Philippine consumers are experiencing a double whammy as oil price hikes causing fuel excise taxes to go up. 

"Matagal ko na nga sinasabi, kung talagang gusto nating pababain 'yung presyo, i-suspend muna natin kahit 'yung increase sa excise tax," Suntay told TeleRadyo Serbisyo. 

According to the Department of Finance, excise tax on gasoline before the implementation of the Tax Reform for Acceleration and Inclusion (TRAIN) Law was P4.35 per liter, while there were no excise taxes collected from diesel, kerosene and liquified petroleum gas (LPG).

This tax remained unchanged from 2005 to 2017, even when the prices of petroleum products increased.

Under TRAIN, the excise tax rates were updated for the different types of fuel to adjust for increases in prices.

The current rates for the major petroleum products are as follows: P10 per liter for gasoline, P6 per liter for diesel, P5 per liter for kerosene, and P3 per liter for LPG. These excise taxes are fixed on a per liter or per kilogram (kg) basis, and do not change depending on the cost of fuel

Suntay warned Philippine consumers are experiencing a double whammy, with oil prices and fuel excise taxes both going up. 

"Habang tumataas 'yung presyo nang pagbili natin ng langis sa pambansang merkado, tumataas yung excise (tax)," he said.

"Kung gusto ng gobyerno na pababain 'yung presyo, isuspindi muna kahit yung excise tax. Kasi ang gusto nilang mangyari sabihin nila sa oil industry players na 'Uy, huwag muna kayo magtaas.' E wala naman tayong control dun dahil hindi naman tayo nag po-produce nang langis. Bumibili lang tayo."

• House leaders to seek 'win-win solution' with oil players

Suntay also corrected the "mistaken notion" that oil companies are making a killing by buying fuel when prices are low and then selling the product when prices go up. 

He said ordering fuel products in September for delivery in October does not mean that the September pricing applies. 

"Halimbawa September ngayon, ang ordering natin sa mga traders sa Singapore, bumibili na tayo for October importation. Hindi ibig sabihin na kapag inorder ko ngayong September, ibig sabihin September pricing, kino-commit ko lang 'yung volume," he said.