House moves to grant Marcos power to suspend fuel excise tax

National

THE House of Representatives has approved on second reading a bill that would allow Ferdinand Marcos Jr. to temporarily suspend or reduce the excise tax on fuel if oil prices sharply increase.

The proposed measure, House Bill No. 8418, was authored by Sandro Marcos, representative of Ilocos Norte, together with Faustino Dy III, the Speaker of the House.

In a report by Philstar, lawmakers said the bill would give the government a quicker way to respond when global events cause fuel prices to surge.

Marcos explained that the proposal aims to protect consumers from sudden increases in the cost of fuel and other basic goods.

“This bill gives the President a measured tool to cushion that shock, with clear triggers, clear limits and clear reporting when the prices of fuel and basic commodities get too high. This is a protection of the people for the sudden increase of prices in basic commodities,” he said in the Philstar report.

The bill would amend Section 148 of the National Internal Revenue Code to allow the President to suspend or reduce the fuel excise tax during national or global economic emergencies.

The move would make it possible to provide immediate relief to the public without waiting months for a new law to be passed.

Miro Quimbo, representative of Marikina and chairman of the House Committee on Ways and Means, said the authority would only be used under strict conditions.

Under the proposal, the President may reduce or suspend the tax only if recommended by the Development Budget Coordination Committee and coordinated with the Secretary of Energy.

The power may also be used only if certain economic conditions are met.

One condition is when the global price of Dubai crude oil reaches or exceeds $80 per barrel for at least one month.

Another condition is when the country is under a declared national emergency or calamity that causes a sharp rise in fuel prices.

The tax relief could apply to selected petroleum products and may involve either a full suspension or only a partial reduction of the tax.

The bill also limits the suspension to a maximum of six months, unless Congress decides to extend or end it earlier. Once the extraordinary conditions are over, the excise tax will automatically return to its normal rate.

The Senate is also reviewing a similar proposal.

Sen. Pia Cayetano, who chairs the Senate Committee on Ways and Means, said lawmakers are still discussing the specific conditions that would activate the President’s authority.

“There are just a few details on when the trigger is. When will the President be given that authority to suspend or reduce the excise tax? And then, when will this authority end? So that’s the question that DOE and DOF have been working on,” she said.

Meanwhile, the Department of Finance expressed support for the proposal but warned about its financial impact. Finance Undersecretary Karlo Adriano said suspending the tax from May to December could cost the government about ₱136 billion in lost revenue, including losses from value-added tax.(Adriane Josef E. Cabase, USJ-R Comm Intern)