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Manila Bulletin devider Philippines devider National devider Solon: Tap fuel VAT collections for electricity bill rebates subsidy

Solon: Tap fuel VAT collections for electricity bill rebates subsidy

Published May 29, 2026 04:35 pm

At A Glance

  • Rep. Alfredo Garbin Jr. proposed using part of fuel VAT collections to subsidize electricity bill rebates for households consuming up to 200 kWh during summer months.
  • He argued this would ease the burden of inflation on Filipino families.
  • Garbin urged the DOF and ERC to show compassion in implementing the subsidy, and cited ERC's openness to solutions that already helped avert rate hikes in April.
(Unsplash)
(Unsplash)


A member of the House Committee on Energy is suggesting the use of fuel value-added tax (VAT) collections in a mechanism to partially subsidize electricity bill rebates.
Ako Bicol Party-list Rep. Alfredo Garbin Jr. made this proposal amid the complaints on social media regarding the so-called "electricity bill shocks", particularly during this summer.
"Electricity bill rebates should be subsidized in part by some of the windfall collections from higher imported fuel VAT and applied to households’ bills up to 200 kwh (kilowatt-hours) in May, June, and July," Garbin told reporters on Friday, May 29.
The effects of fast inflation on common Filipinos also weren't lost on the lawyer-solon.
"This is one effective way to significantly reduce the suffering of Filipino households nationwide because of elevated inflation. Inflation hits the poor the most," noted Garbin, also a member of the Committee on Trade and Industry.
Fuel in the Philippines is subject to a 12 percent VAT.
The Philippine government earns roughly P247 billion annually from fuel-related taxes and VAT collections, according to 2025 data from the Bureau of Customs (BOC) and Department of Finance (DOF). This revenue is a critical source for national funding, but proposals to suspend VAT during crises could cut billions from the budget.
"Implementing this requires compassion from both the [DOF] and the Energy Regulatory Commission (ERC)," Garbin said, referring to his subsidy proposal.
"How much the subsidy can be, depends on the DOF and the targeting of the subsidy depends on the ERC," he noted.
"I put this suggestion forward, encouraged by the openness of the ERC to workable solutions, and noting their efforts that averted net rate increases in the April billings of Meralco household consumers," he further said.

Related Tags

Electricity bill Alfredo Garbin Jr. VAT Subsidy
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