Poe files bill seeking automatic suspension of excise taxes on gasoline, diesel

Senator Grace Poe on Monday filed a bill amending the National Internal Revenue Code (NIRC) to provide rules for automatic suspension of excise taxes' collection on gasoline and diesel.

Senate Bill 2445 amends Section 148 of the NIRC and provides for the automatic suspension of the excise tax on gasoline, unleaded premium gasoline when the average Dubai crude oil price based on Mean of Platts Singapore (MOPS) for three (3) months prior to the scheduled increase of the month reaches or exceeds US$80 per barrel.

According to Poe, the suspension of excise tax will immediately bring down the cost of gasoline by P10 per liter and P6 per liter for diesel.

In a statement, the senator cited Philippine Statistics Authority data, showing that food inflation dropped in October to 5.3%, but fuel inflation rocketed to 32.9% from 21.3% in September, the highest among the data reported this year.

“The rising cost of fuel is certain to have a spillover effect on the cost of other products, especially food which accounts for a big chunk of a household’s expenses. Such will aggravate poverty and hunger among our people. If government cannot substantially provide for its people, then at the very least, it must do all it can to ease their burden,” Poe said.

The automatic suspension of excise taxes on fuel products was first implemented when the Tax Reform for Acceleration and Inclusion (TRAIN) law was enacted. However, this was only a transitory provision and was only effective from 2018 to 2022.

Poe likewise mentioned that the TRAIN law requires the Department of Finance (DOF) to conduct an annual review of the implementation of the excise tax on fuel based on projections and recommendations of the Development Budget and Coordination Committee but it also requires that the suspension should not result in any reduction of the excise tax being imposed at the time.

Moreover, the senator noted that the administration had pushed for the lowering of corporate income taxes under the CREATE law which, she said, has around P251 billion foregone revenues in the first two years of its implementation.

“If the government can afford P251 billion for big companies, why can’t it do the same for jeepney drivers, delivery riders, and everybody else who have to go to work and are forced to bring their own vehicles because there's not enough public transportation?” Poe asked.

Previously, the DOF said the government will lose P131.4 billion if the implementation of excise taxes on petroleum products will be suspended.—AOL, GMA News