Marcos suspends excise tax on LPG, kerosene for 3 months
President Marcos has ordered the temporary suspension of excise taxes on liquefied petroleum gas (LPG) and kerosene for three months to ease the burden of rising fuel costs amid the ongoing energy crisis.
The directive was issued through Executive Order No. 114, signed on April 16, following the recommendation of the Development Budget Coordination Committee (DBCC).
Under the order, excise taxes on LPG and kerosene are fully suspended for three months from the effectivity of the measure.
However, the suspension does not apply to LPG used as raw material for petrochemical production or as fuel for vehicles, as well as kerosene used as aviation fuel.
The EO provides that the suspension will be subject to monthly review by the DBCC.
The committee may recommend the continuation, modification, extension, or termination of the tax relief depending on global oil price trends.
Triggered by high oil prices
The move was triggered after the Department of Energy certified that the average Dubai crude oil price reached $93.71 per barrel over a 30-day period.
This exceeded the threshold set under Republic Act No. 12316, which allows the President to suspend or reduce fuel excise taxes during periods of high global oil prices.
Automatic reversion of taxes
The EO states that excise tax rates will automatically revert to previous levels once conditions stabilize.
This includes when oil prices fall below $80 per barrel based on international benchmarks, or upon the expiration of the three-month period.
Immediate relief for households
President Marcos earlier said the measure would result in direct savings for Filipino families.
“P3.36 ang bawas kada litro ng LPG… at P5.60 kada litro ng kerosene (P3.36 per liter will be cut from LPG… and P5.60 per liter from kerosene),” he said.
He added that households could save nearly P37 per LPG tank.
“Ibig sabihin mas mababa ang gastos sa pagluluto at araw-araw na pangangailangan (This means lower costs for cooking and daily needs),” he said.
Agencies tasked to monitor
The Department of Energy (DOE) and the Department of Finance (DOF), through the Bureau of Internal Revenue (BIR) and the Bureau of Customs (BOC), were directed to monitor implementation of the order.
They are required to conduct an inventory of LPG and kerosene stocks upon the effectivity of the EO.
Reports to Congress
The BIR and BOC were also instructed to submit monthly reports to Congress on the volume and declared value of petroleum products covered by the suspension.
The measure forms part of the government’s response to the ongoing energy emergency driven by global oil supply disruptions.
Rising fuel prices, linked to geopolitical tensions, have affected transport, food, and household expenses.
Republic Act No. 12316, signed earlier, grants the President authority to suspend or reduce excise taxes on petroleum products for up to three months per instance.
The law allows extensions for up to one year, depending on prevailing conditions.
Malacañang said the government will continue to implement measures to mitigate the impact of rising fuel costs.