MANILA – Sen. Joseph Victor “JV” Ejercito has reiterated his call for the government to suspend the next tranche of excise tax increase on fuel amid the spiking inflation and global oil prices.
“I urge our economic managers to consider postponing the next round of increases in excise taxes this January 2019,” Ejercito said in a statement.
“With crude oil at $83/barrel and a 6.4 percent inflation rate, we need to soften the impact on our people,” the senator added.
Ejercito first issued his call in May after he and other senators expressed concern on the inflationary effects of the TRAIN law.
TRAIN allows suspension of hikes if it reaches $80 for three months, according to Ejercito.
The Tax Reform for Acceleration and Inclusion (TRAIN) law imposed an excise tax of P2.50 per liter on diesel and raised the levy on gasoline to P7 from P4.35 per liter.
The excise tax rate on diesel will go up to P4.50 next year and P6 per liter come 2020. For gasoline, the levy will go up to P9 in 2019 and P10 in 2020.
The TRAIN, however, has a pertinent provision on the suspension of fuel excise taxes.
“For the period covering 2018 to 2020, the scheduled increase in the excise tax on fuel as imposed in this Section shall be suspended when the average Dubai crude oil price based on Mean of Platts Singapore (MOPS) for three months prior to the scheduled increase of the month reaches or exceeds $80 per barrel,” the provision read.
The Department of Finance has earlier said that it will be ready to activate the suspension mechanism for the next increase in January 2019 should the price of Dubai crude keep going up and the three-month average in the last quarter of this year hits 80 dollars per barrel. (GMA News)
