Transportation groups call for suspension of excise tax
Various transport groups lobbied on Sunday for the suspension of the excise tax on petroleum products in anticipation of a huge hike in fuel prices this week, with diesel expected to rise by up to 6 pesos a litre.
It was then that the vice-president of the Trades Union Congress of the Philippines, Luis Corral, warned that a “perfect storm” was brewing amid rising food and electricity prices, as well as rising unemployment and underemployment rates.
“For us at TUCP, there seems to be a perfect storm brewing…People are unable to afford rent, utilities, food and ordinary health care,” he said.
“The attitude of the Marcos administration should not be like before. They should work doubly, triply, to find solutions and undertake consultations to immediately address these concerns,” Corral said.
Ricardo Rebaño, president of the Federation of Jeepney Operators and Drivers of the Philippines (FEJODAP), for his part said that a suspension of three to four months of fuel excise tax was necessary to ease the burden of the skyrocketing oil prices on drivers and transport operators.
He said it was a better bet than asking for another round of fare hikes, which would pass the burden onto commuters.
“We are asking for even a few months of fuel excise tax suspension until oil prices stabilize so that we can have a win-win solution,” he said. .
Industry sources said the price per liter of diesel could rise by P6 to P6.30 on Tuesday, while petrol prices could rise by P1.10 to P1.40 per litre.
National President Mody Floranda, the national chairman of the national operator (PISTON), said that apart from the suspension of the excise tax, the Petroleum Deregulation Law and the TRAIN Law also need to be amended.
“The government must revise the provisions of the Petroleum Deregulation Act and the TRAIN Act – the expanded VAT and excise tax on petroleum products – as we do not import petroleum products on a weekly or monthly basis” , said Floranda.
The Ministry of Finance has previously warned the Marcos administration against suspending the collection of excise tax on petroleum products, saying it was “not the most effective approach to alleviate the conditions of the sectors affected”.
The expected rise in oil prices on Tuesday will end five straight weeks of declines.
OPEC+ announced a production cut of 2 million barrels per day starting next month to boost oil prices after its Oct. 5 meeting.
Global oil prices fell slightly above $80 a barrel from a high of $120 a barrel in previous months on fears of a global recession.
On October 4, oil companies reduced the prices of gasoline by PZ 0.40 per litre, diesel by PZ 0.45 per liter and kerosene by PZ 0.85 per litre.
These have resulted in a total net increase since the beginning of the year of 14.45 pesos per liter for gasoline, 28.95 pesos per liter for diesel and 23.25 pesos per liter for kerosene.