THE government is not keen on lifting the excise tax on gasoline and diesel as it could incur up to P43.6 billion in revenue losses in three months, the Department of Finance (DOF) said Tuesday.
In a press conference in Malacañang, Finance Undersecretary Karlo Fermin Adriano said the suspension of excise tax on liquefied petroleum gas (LPG) and kerosene would result in an estimated P4.1 billion in foregone revenues for three months.
“Now, if you decide to include a suspension of diesel and gasoline and LPG and kerosene on top, it will be around P43.6 billion in losses in three months,” Adriano said.
The excise tax suspension on LPG and kerosene was approved by President Ferdinand Marcos Jr., following recommendations from the Development Budget Coordination Committee (DBCC), to balance fiscal responsibility with targeted relief measures.
But Adriano said the DBCC, in its recent meeting, did not include lifting excise taxes on gasoline, as it would not provide “meaningful relief” and would result in substantial revenue losses, potentially widening the country’s deficit.
He said while there would be an additional value-added tax (VAT) collection of P13 billion to P14 billion due to higher fuel prices, that would not be enough to offset the potential revenue losses from a full suspension.
“Again, if you consider full suspension of diesel and gasoline, if you include it, the total losses will be P43.6 billion. And your additional VAT collection will be around P13 billion to P14 billion ... there’s a negative revenue loss of around P30 billion,” he said.
Adriano also said the decision to fully suspend excise taxes on LPG and kerosene was intended to directly help every Filipino family and small businesses such as carinderias.
Citing data from the Philippine Statistics Authority’s 2023 Family Income and Expenditure Survey, he said that about 50 percent of kerosene consumption came from the poorest 38 percent of the Filipino households, while 56 percent of LPG consumption was attributed to the bottom 70 percent.
The DOF official said the suspension was expected to bring savings of around P36.95 per 11 kg. LPG cylinder and P5.60 per liter of kerosene.
Adriano said the DBCC would continue to monitor the situation to determine if suspending the excise tax for diesel and gasoline is necessary.
P10 fuel subsidy
Instead of a broader tax suspension, the government is implementing targeted subsidies, including a P10-per-liter fuel subsidy program.
The P10 fuel discount for public utility jeepneys started on Tuesday in 52 participating gasoline stations.
In the same press conference, Energy Secretary Sharon Garin said the Department of Energy has directed all legitimate gas stations to participate in the fuel discount program, but only 33 of 52 stations were participating due to pending registration in the LandBank app.
Garin expressed optimism that LandBank personnel would be able to complete the registration of all 52 gas stations in Metro Manila, noting that the government program offering a P10-per-liter discount for public utility vehicles would be rolled out nationwide.
Landbank President and Chief Executive Officer Lynette Ortiz expressed commitment to completing the registration of all 52 gasoline stations in Metro Manila on Tuesday.
The Land Transportation and Franchising and Regulatory Board (LTFRB) will submit a whitelist of legitimate operators of modern and traditional jeepney and UV Express operators to the Landbank and gasoline stations, the agency’s chairman, Vigor Mendoza II, said.
Each jeepney unit will have a maximum of P1,500 or 150 liters per week.
“Now, if they don’t use up that P1,500, will that carry over to next week? No. So, it is necessary to use that up for the week, those five days, the P1,500 or 150 liters per week,” Mendoza said.
Transportation Secretary Giovanni Lopez said the Department of Transportation and DOE are studying if the P10 discount could eventually be extended to PUVs using gasoline, such as Transportation Network Vehicle Services (TNVS) and motorcycle taxis.
