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Manila Bulletin devider Philippines devider National devider Ordanes wants answers as VAT exemption on indigenous natural gas remains unenforced

Ordanes wants answers as VAT exemption on indigenous natural gas remains unenforced

Published Nov 19, 2025 03:46 pm

At A Glance

  • Senior Citizens Party-list Rep. Rodolfo "Ompong" Ordanes is seeking an explanation on the delayed implementation of the law that mandates tax exemption on indigenous natural gas, which could provide relief to consumers, particularly the elderly.
Senior Citizens Party-list Rep. Rodolfo “Ompong” Ordanes (Contributed photo)
Senior Citizens Party-list Rep. Rodolfo “Ompong” Ordanes (Contributed photo)

Senior Citizens Party-list Rep. Rodolfo “Ompong” Ordanes is seeking an explanation on the delayed implementation of the law that mandates tax exemption on indigenous natural gas, which could provide relief to consumers, particularly the elderly.
Ordanes filed for this purpose House Resolution (HR) No. 472, which directed the Committee on Energy to conduct an inquiry, in aid of legislation, on Value-Added Tax (VAT) removal mandated under Republic Act (RA) No.12120, or the Philippine Natural Gas Industry Development Act.
The measure was referred to the Committee on Rules during plenary session Wednesday afternoon, Nov. 19.
Enacted on Jan. 8, 2025, RA No.12120 provides that the sale of indigenous natural gas and the power generated from it be exempt from VAT.
The relatively new law is intended to help lower electricity costs for Filipino consumers. This includes senior citizens and low-income households.
The Department of Energy (DOE) already released the law's Implementing Rules and Regulations (IRR) on April 8, 2025. The IRR took effect 15 days later.
The Bureau of Internal Revenue also issued Revenue Memorandum Circular No. 11-2025 to support implementation.
Ordanes noted that despite these developments, the VAT exemption was yet to be implemented, as he emphasized that power plants using indigenous natural gas continue to be charged 12 percent. VAT.
As a result, households consuming around 200 kilowatt hour (kWh) per month still pay approximately ₱42 every billing cycle due to the unremoved VAT burden, according to the resolution.
Ordanes said the delays undermine the very purpose of the law, which was designed to provide much needed relief to consumers.
“This delay constitutes an administrative lapse and a failure to implement a policy specifically designed that will give relief to Filipino electricity consumers, including senior citizens,” explained the elderly solon.
The lawmaker said he also wrote a formal letter to DOE Secretary Sharon Garin requesting an update on the status of implementation and seeking clarity on the remaining steps needed to operationalize the VAT exemption.
“We already asked the DOE to provide a written explanation and to give a definite and time-bound action plan for the implementation of the law,” Ordanes said.
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