Philippines to Seek Resumption of Tax Relief on Kerosene, LPG Amid Oil Price Surge

MANILA, Philippines — The Department of Finance (DOF) is preparing to seek the second round of suspension of excise taxes on kerosene and liquefied petroleum gas (LPG) as global oil prices surge past $100 a barrel amid a renewed conflict in the Middle East. According to DOF, Finance Secretary Frederick Go is awaiting certification from the Department of Energy (DOE) that the price of Dubai crude oil has once again exceeded the $80-per-barrel threshold set by the Development Budget Coordination Committee (DBCC). READ: Excise holiday for LPG, kerosene over – BIR DOE data show that, as of Sept. 8, prices of Dubai crude had increased by about $8 per barrel week-on-week amid sustained war risk premiums from the escalating conflict between the United States and Iran. Domestic pump prices are also seen to rise again by as much as P5 per liter starting next week. The suspension was first allowed under Executive Order No. 114, signed on April 16. A full suspension of the excise taxes reduced the price of an 11-kilogram LPG tank by P37 and cut P5.65 from the price of kerosene per liter. Under the EO, the excise tax rates automatically revert to their original levels upon the occurrence of either of two conditions, whichever comes first—one week after the one-month average price of Dubai crude falls below $80 per barrel, or upon the expiration of the three-month suspension. READ: DOF defends decision vs fuel tax suspension, cites P50-B loss The three-month suspension was automatically lifted in June after the one-month average price of Dubai crude settled below $80 per barrel. Notably, the DBCC’s first suspension did not cover diesel and gasoline, which carry higher excise tax rates. The DOF said a suspension on kerosene and LPG would provide greater relief to poorer households, while tax cuts on diesel and gasoline would disproportionately benefit wealthier consumers. Socioeconomic Planning Secretary Arsenio Balisacan said this was why a suspension of the tax should be aimed at public utilities. “The rich can absorb it (nonsuspension of taxes on diesel and gasoline),” Balisacan told the Inquirer. INQ