Senate bill seeks VAT exemption of households consuming 150KW or less per month

Amid concerns regarding rising electricity costs, Senator Risa Hontiveros on Tuesday filed a measure seeking to remove the value-added tax (VAT) from the monthly electricity bills of households consuming 150 kilowatt-hour (kWh) or less.

Under Senate Bill No. 2093 or the proposed “Kuryente Relief Act of 2026,” Hontiveros said the VAT exemption is expected to translate into monthly savings of approximately P250 to P300 for households included in the broader group of so-called “energy poor” consumers.

“Dapat lang na palawakin ng pamahalaan ang tulong nito mula low-income hanggang middle-income households na kadalasan ay ‘di naaabot ng subsidy programs. Makakatipid ang maraming pamilya kung tatanggalin natin ang VAT sa bill ng mga kabahayang ‘di naman kalakihan ang gamit sa kuryente,” Hontiveros said.

(The government should extend its assistance from low-income to middle-income households that are often not reached by subsidy programs. Many families will be able to save if we remove the VAT from the bills of households that do not use much electricity.)

The bill mainly provides for the VAT exemption of residential households consuming 150 kWh or less monthly, with distribution utilities and electric cooperatives automatically reflecting the exemption on consumers' statements of accounts “without prior need for application.”

The Energy Regulatory Commission (ERC) shall also ensure that the reduction arising from this exemption shall not be passed on to residential household consumers through distribution wheeling charges or other pass-through components.

“Ngayong sumisipa sa taas ang singil ng kuryente, pati middle income families ay nahihirapan na sa bayad sa kuryente. Our tax and energy policies should be more fair and adapt to this concerning reality,” Hontiveros added.

(Now that electricity bills are skyrocketing, even middle-income families are struggling to pay their electricity bills. Our tax and energy policies should be more fair and adapt to this concerning reality.)

Hontiveros also earlier filed Senate Bill No. 2076, which seeks to remove the VAT on system loss charges in electricity bills. The measure aims to amend the National Internal Revenue Code (NIRC) to exempt system loss charges from VAT, amid reports of higher electricity costs during the dry season.

Other lawmakers both from the Senate and the House of Representatives have also called for a review of existing policies on electricity subsidies following complaints over rising power bills. —VAL, GMA News