THE House committee on ways and means yesterday approved a substitute bill seeking to suspend the excise tax on diesel, kerosene, and liquified petroleum gas and reducing the rate for other oil products for six months to cushion the impact of the exorbitant prices of petroleum products.
The panel chaired by Albay Rep. Joey Salceda approved the substitute bill to give “immediate relief” to the public, especially the hardest hit sectors.
Salceda said the House hopes to turn the bill over to the Senate before the end of November.
Salceda said that while the bill will cost the government around P45 billion, it is acceptable since “what the government loses, the consumer gains.”
He added that there is a self-correcting mechanism in the bill reverting to TRAIN (Tax Reform for Acceleration and Inclusion law) rates if the prices “normalize.”
This means that if the price of crude oil goes back to 65 dollars per barrel, the excise tax rates will also normalize.
“The premise of this tax relief bill is that the situation is not normal. If inflation weren’t so high, we would be discussing other matters. But now, consumers are hurting. Inflation is high. Incomes are depressed. So, immediate relief is obviously necessary,” he said.
Under the proposed measure, excise taxes on low-octane gasoline, used primarily by tricycle drivers, will also be reduced to P4.35 while current taxes on premium gasoline which is set at P7 will be retained.
