More than a billion liters of fuel under the fuel marking scheme has already been “marked” as part of government efforts to plug tax leakages from oil smuggling and other fuel fraud, the Department of Finance (DOF) said.
Carlos Dominguez, DOF secretary, told reporters at the DOF office in Manila Friday 1.1 billion liters of fuel have already been marked since the start of the fuel marking activity in October last year.
The Bureau of Customs (BOC) previously encouraged oil companies whose petroleum products have yet to be marked to work with the implementing agencies of the program to urgently have their products marked.
By Feb. 3, 2020, testing of fuel in the retail side as well as enforcement actions will commence. Gasoline, diesel and kerosene found to be unmarked will be seized, and penalties will be imposed against those storing, transporting, importing or peddling unmarked fuel.
The BOC earlier said the agency, together with the Bureau of Internal Revenue (BIR), DOF, and SICPA-SGS are continuously working closely with oil companies in the country to fast-track the marking of petroleum products.
The joint-venture of Switzerland-based SICPA SA and SGS Philippines is the provider for the fuel marking system.
Early last year, the government said it plans to “mark” more than 15 billion liters of fuel.
The fuel marking program is mandated under the Tax Reform for Acceleration and Inclusion (TRAIN) Law to curb oil smuggling and misdeclaration of petroleum products in the country, and increase revenue collection from taxable imported and locally refined petroleum products.
The program uses an official fuel marker, a unique chemical marker detectable at a molecular level, allowing for authorities to test, identify, and distinguish petroleum products with paid excise taxes in the market from those without.
After a three-month “flush-out period”, within which all downstream fuels are expected to have been marked, random field testing shall be conducted by BOC, BIR, and the fuel marking provider on depots, tank trucks and retail stations to determine the presence and/or dilution level of the fuel marker on petroleum products subject to marking.
Fuels found to be unmarked or with marker levels below the prescribed dilution level shall be immediately subjected to confirmatory testing in an accredited testing facility of the fuel marking provider.
The fuel marking program is expected to plug an estimated P27 billion to P44 billion annual revenue losses.