Duterte to talk to Cabinet on fate of fuel excise tax hike in 2019

Gasoline stations, like this one in Manila, started to ride on the TRAIN law by announcing increases in pump prices as a result of the new tax law. INQUIRER/GRIG C. MONTEGRANDE

President Rodrigo Duterte on Monday said he will consult his Cabinet before he decides on his economic managers’ plan to push through with the scheduled fuel excise tax increase next year.

“We will discuss it (on the Cabinet meeting tomorrow)… It’s a collegial body so we have to arrive at a consensus how it could affect – how it would impact on each and every aspects of the life of the community and that can be articulated by the Cabinet members,” Duterte told reporters in an interview in Malacañang.

Asked if a decision will be made after Tuesday’s Cabinet meeting, Duterte said: “Not necessarily.”

The Duterte administration’s economic team had initially recommended for the suspension of the second tranche of fuel excise tax hike in 2019, which Duterte recently approved.

READ: Diokno: Duterte approves temporary suspension of oil excise tax increase

But the economic managers backpedaled and announced its plan to recommend to the President to carry on with the implementation of the increase as mandated under the Tax Reform for Acceleration and Inclusion (TRAIN) Law.

Finance Secretary Carlos Dominguez III said the decision to backtrack with the suspension of the second installment of fuel excise tax increase in 2019 was triggered by the recent drops in global oil prices. He noted, however, it will be ultimately up to Mr. Duterte to decide on the matter when the Cabinet meets on Tuesday.

Fuel excise taxes increased by P2.5 per liter this year, and the levy is scheduled to rise by P2 and P1.5 per liter in 2019 and 2020, respectively, for a total P6 fuel excise tax hike for three years, as directed in the TRAIN Law.

According to the tax decree, suspension of fuel excise tax hike would only occur when the average Dubai crude price for three consecutive months before the next scheduled increase reaches or exceeds $80 per barrel. /kga