Duterte suspends 2019 increase in fuel excise tax
President Rodrigo Duterte has approved the suspension of the second round of increases in fuel excise tax scheduled in 2019, Budget Secretary Benjamin Diokno said Wednesday, Nov. 14.
“I just got a communication from the Executive Secretary, saying that our proposal to suspend the P2-peso additional excise tax next year has been approved,” Diokno said in a press briefing.
“We already anticipated that price of oil will be much lower next year. So if you ask me, I’m willing to recommend we stick to the decision not to impose additional P2 in the meantime,” he added.
Diokno made the announcement barely two months before the impending scheduled increase of excise tax rates of petroleum products next year.
Duterte’s latest move stemmed from his economic managers’ recommendation to postpone the imposition of additional fuel excise tax in January 2019 under the second tranche of the Tax Reform for Acceleration and Inclusion (Train) Law.
It was on Oct. 9 when Duterte first expressed his intent to suspend the excise duties on fuel, in a bid to cushion the impact of soaring prices of goods.
Under the Train Act, the excise tax on liquefied petroleum gas (LPG), diesel, gasoline, and kerosene went up to P1, P2.50, P7, and P3, respectively, this year.
In 2019, the excise tax on LPG will increase to P2, diesel to P4.50, gasoline to P9, and kerosene to P4.
The Train law states that the next round of increases in fuel excise tax will be suspended when Dubai crude oil prices exceed the $80 per barrel threshold in the last three months of 2018, or prior to the scheduled increase of excise taxes on petroleum products.
The Budget chief said the suspension of fuel excise taxes will take effect in the first quarter of 2019, and will be subject to a quarterly assessment.
“Let’s see. We will evaluate in a quarterly basis,” Diokno said. /