Tulfo bill seeks automatic VAT, excise tax suspension on fuel amid Middle East crisis
By Dhel Nazario
At A Glance
- Senator Erwin Tulfo is pushing for a measure seeking the automatic suspension of Value-Added Tax (VAT) and excise taxes on fuel.
Senator Erwin Tulfo is pushing for a measure seeking an automatic suspension of Value-Added Tax (VAT) and excise taxes on fuel.
At a Quezon City gas station, a pump attendant fills a car's fuel tank. This week, the cost of petroleum products has risen, a direct result of escalating geopolitical tensions in the Middle East.
Tulfo, chairman of the Senate Committee on Foreign Relations, sought the action amid the ongoing tension in the Gulf Region, which was expected to trigger an oil price surge.
This also came as President Marcos declared that he would certify as urgent a proposed measure granting him temporary authority to reduce excise taxes on petroleum products.
“This measure establishes a clear and objective trigger for relief especially with unprecedented external events that can have a trickle down effect on oil prices such as what is going on in the Gulf Region,” Tulfo said.
He likewise pointed out that the measure will be of use for temporary relief, especially to minimum-wage earners.
“We have to do a balancing act because this is an emergency. We must ensure the welfare of the ordinary Filipinos is prioritized amid the crisis,” he said.
Under Tulfo’s Senate Bill (SB) no. 1935, which pushes to amend Sections 106, 107, and 148 of the Tax Code, the VAT on the sale of fuel shall be suspended when the average Dubai Crude Oil Price based on the Mean of Platts Singapore (MOPS) reaches 80 USD per barrel.
VAT on the importation of fuel would likewise get suspended when the MOPS reaches or exceeds 80 USD per barrel.
Tulfo’s bill also seeks to automatically suspend the excise taxes on oil imposed in the country when the average global oil prices reach or exceed 80 USD.
“In our existing laws, there is no automatic mechanism that cushions consumers when global oil prices surge. The continued imposition of 12% VAT and excise taxes on fuel during extraordinary price spikes will gravely impact consumers,” the lawmaker noted.
It may be recalled that as soon as the tensions between US-Israel and Iran broke out, Tulfo called for immediate relief and the consultation of all stakeholders, including the PUV drivers, farmers, and fisherfolk, and not only the owners of oil companies.