DOF awaits DOE nod to propose full suspension of LPG, kerosene excise taxes

The Department of Finance (DOF) is awaiting certification from the Department of Energy (DOE) that Dubai crude oil prices have breached the threshold, so it can propose fully suspending excise taxes on liquefied petroleum gas (LPG) and kerosene.

According to the DOF, Secretary Frederick Go is awaiting DOE confirmation that Dubai crude oil breached the $80-per-barrel threshold on a one-month average, the threshold needed to propose suspending fuel excise taxes.

“The SOF Frederick D. Go is prepared to immediately propose to the DBCC (Development Budget Coordination Committee) the suspension of 100% of the excise taxes on LPG and Kerosene, for the President’s approval,” it said.

The Tax Reform for Acceleration and Inclusion (TRAIN) Law established excise taxes of P3.00 per kilogram for LPG and P5.00 per liter for kerosene.

READ: By how much could pump prices drop if excise taxes are suspended?

President Ferdinand “Bongbong” Marcos Jr. signed Republic Act 12316 into law in March, giving him emergency powers to suspend or reduce the excise tax rate on fuel.

Under the measure, the suspension or reduction may be implemented for up to three months if the average price of Dubai crude oil —based on the Mean of Platts Singapore (MOPS)—reaches or exceeds $80 per barrel for one month. Brent crude prices have hovered around $102 per barrel.

West Texas Intermediate, the key US oil benchmark, rose above $100 per barrel on Thursday after Yemen’s Houthis captured the Red Sea port city of Mocha. Brent crude also rose over 6% past $107 a barrel, its highest level since May. –NB, GMA News