Economic managers to push for oil tax hike in 2019
MANILA, Philippines – Economic managers of the Duterte Administration’s has decided to submit a recommendation to President Rodrigo Duterte to push the excise tax on oil products in 2019.
The recommendation which was decided over a meeting with the Development Budget Coordination Committee (DBCC) on Thursday (November 29), came after the price of oil in the world market dropped in the previous months.
If approved, the price of gasoline will have an additional P2.00/liter in excise tax.
Based on records, the price of Dubai Crude Oil dropped from $76 US dollars per barrel in October to $68 US dollars per barrel in November.
This is projected to reduce further by next year to $60 US dollars per barrel apart from the expected fall in inflation.
In a statement, the DBCC said: “Our recommendation to continue the scheduled increase of excise taxes on petroleum products will be further discussed in the Cabinet meeting on Tuesday, December 4 and subject to the approval of President Rodrigo Roa Duterte.”
It can be recalled that the Office of the President issued a memorandum in approval of the recommendations of the economic managers to suspend the implementation of the second tranche of tax increase in order to alleviate the impacts of rising inflation.
The DBCC emphasized the negative impacts should the suspension of the oil tax hike pushes through in 2019.
“The DBCC also took into consideration the adverse impact on revenues and expenditures for fiscal year 2019 should the government proceed with the suspension of the scheduled increase of excise taxes on petroleum. The said measure is estimated to result to a net revenue loss of PhP 43.4 billion for a 12-month suspension,” the statement stated.
But the research group Ibon Foundation argued that the said latest decision of the government’s economic managers reflect the Duterte Administration’s insincere intention to address the negative effects of inflation and the Tax Reform for Acceleration and Inclusion (TRAIN) Law to the ordinary and the poorest of the Filipinos.
Lifting the fuel excise tax suspension shows the Duterte administration’s insincerity and insensitivity in addressing the inflationary impact of the tax reform program, particularly on poor Filipino households,” the group concluded. – Marje Pelayo (with reports from Rosalie Coz)
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