(Eagle News) – President Rodrigo Duterte has decided to temporarily suspend the implementation of the additional fuel excise tax to “arrest the rising price of oil” and to tame inflation, according to Special Assistant to the President Christopher “Bong” Go.
In his speech at the opening of the TienDA Malasakit Store in Taguig City on Sunday, October 14, Go said that the temporary suspension of the second tranche of the fuel excise tax would be in effect “until the right time.”
The second tranche of the excise tax for fuel is supposed to take effect in January 2019, amounting to at least P2 per liter.
The government imposed P2.50 tax per liter of diesel and P1 on liquefied petroleum gas in excise tax for fuel under the first tranche this year, under the Tax Reform for Acceleration and Inclusion (TRAIN) law.
The TRAIN law levies a total of P6 per liter on oil products, spread over three years starting 2018 up to 2020.
Earlier, President Duterte himself said he was open to suspend excise taxes on oil to curb inflation.
Asked by Malacanang reporters on October 9 if he would support the suspension of excise taxes on fuel, Duterte said, “Maybe.”
He said he already asked Finance Secretary Carlos Dominguez III to look into the proposal.
The President had stressed that inflation was caused by rising oil prices in the world market, and that the Philippines is vulnerable to such rise in oil prices as it had no oil reserves.
Finance Undersecretary Karl Kendrick Chua earlier said that a suspension of excise tax increases levied on petroleum products under TRAIN law was possible next year, but only if global crude prices average USD80 per barrel in the last quarter of 2018.
As of October 10, oil prices in the international market has already risen to $86 per barrel. Analysts even predict that it could further rise to $100 per barrel before year-end, if geo-political tensions in the Middle East would go on.
Chua said that if oil prices in the world market continue to average $80 per barrel in the next three months, a suspension of the second tranche of excise tax hike for petroleum products was possible.
(Eagle News Service)