House bill allowing President to suspend, reduce fuel excise taxes OK’d on final reading

The House of Representatives on Monday approved a bill allowing President Ferdinand "Bongbong" Marcos, Jr. to suspend or reduce the excise taxes on fuel on third and final reading amid rising oil prices due to Middle East conflict

This developed after the House plenary, with 248 yes votes, three no votes and zero abstentions, approved House Bill 8418 which grants the President such emergency powers for six months at the maximum, provided that the average Dubai crude oil price exceed US$ 80 per barrel for one month immediately preceding the suspension or reduction of the excise tax. 

Likewise, the bill provides that the President will only have such additional authority until December 31, 2028.

The price of Dubai crude oil already breached US$100 as of March 9.

Oil prices have increased by P17 to 24 per liter the past week, prompting transport group PISTON to announce a nationwide transport strike scheduled for March 19.

The current escalation in the Middle East started when the US and Israel launched airstrikes targeting Iran’s seat of government on February 27, supposedly to deter Iran’s missile program threatening the region’s security.

This operation has since killed Iranian leaders as well as hundreds of civilians including children, and prompted Iran to retaliate by launching airstrikes targeting US bases, among others, in Middle Eastern countries where the Philippines sources 98% of its crude oil supply. 

Administration lawmakers said such emergency powers will alleviate the public's plight amid prolonged fuel price increases.

“This measure is in direct response to the ongoing crisis in the Middle East that has a direct effect on fuel prices and the cost of basic goods in the Philippines. Lalo na ngayon, lagpas P90 na ang diesel [Especially now that diesel is more than P90 per liter]. We need to pass this into law to directly aid the people. If the President can temporarily lift the excise tax, that is up to P10 per liter for gasoline and P6 per liter for diesel that can be taken off the price,” House Majority Leader Sandro Marcos of Ilocos Norte, the President's son, said.

“The amount may be small, given that pump prices will increase again, but the government is providing other forms of assistance [to complement this measure],” Leyte Representative Martin Romualdez added.

Under the existing law, excise taxes are embedded in the retail price of fuel, which means every increase becomes part of the cost of commuting, delivering goods and running businesses, particularly for workers who spend daily just to get to work and parents who watch their market budget shrink with every spike.

House Bill 8418, on the other hand, provides that any Presidential suspension or reduction of excise taxes will be effective for a period not exceeding six months, unless extended or terminated earlier by Congress through a joint resolution, placing a clear limit on how long the authority can be used per issuance.

Oil deregulation

Makabayan bloc lawmakers, however, said the grant of emergency powers is not a long-term solution and called for permanently removing the taxes on petroleum products.

“We strongly assail President Ferdinand Marcos Jr.’s bid for emergency powers as a classic panakip-butas and power grab that refuses to confront the real causes of the crisis. Congress already has pending measures that can provide direct and lasting relief, including the removal of taxes that balloon fuel prices,” Antonio Tinio of ACT Teachers party-list, Sarah Elago of Gabriela party-list and Renee Co of Kabataan party-list said in a statement.

“What the people need is decisive legislation and regulation against profiteering, not discretionary powers that will be used for temporary, selective, and politically convenient concessions. Kainutilan ang paulit-ulit na paghingi ng dagdag na kapangyarihan habang hinahayaan ang kartel at deregulation na wasakin ang kabuhayan,” they added.

(Emergency powers are useless while we allow the cartel and Oil Deregulation law to destroy the livelihood of our people.) — BM, GMA Integrated News