Pimentel files bill seeking VAT, excise tax suspension on fuel
Sen. Aquilino “Koko” Pimentel III. Senate PRIB file photo / Bibo Nueva España
MANILA, Philippines — Senator Aquilino “Koko” Pimentel III on Monday filed a bill seeking the suspension of value-added tax (VAT) and excise tax imposition on fuel amid soaring prices of the product.
Pimentel’s proposed measure for the 19th Congress is an amendment to Sections 106, 107, and 148 of the National Internal Revenue Code of 1997.
The senator noted that excise tax adds P10 pesos to a liter of gasoline and P6 pesos to diesel, excluding the VAT, which adds another 12 percent to the total fuel cost.
“Fuel prices have been rising. This can be attributed to geopolitical developments and other factors,” Pimentel said in his explanatory note.
Since Russia’s — a key crude producer — invasion of Ukraine, fuel prices continue to increase.
Article continues after this advertisement“As a means of contributing to the easing of the adverse impact of rising fuel prices, now and in the future, this bill proposes to provide a mechanism for the automatic suspension of the imposition of value-added tax and excise tax on fuel to help alleviate the almost midnight gargantuan increase in prices which severely affect the entire Filipino Nation and is causing worrisome inflation right now as we are recovering from the effects of economic recession caused by the COVID-19 pandemic,” the senator said.
Article continues after this advertisementUnder Pimentel’s bill, Section 106 will be read as: “(A) Rate and Base of Tax. – There shall be levied, assessed and collected on every sale, barter or exchange of goods or properties, value-added tax equivalent to twelve percent (12%) of the gross selling price or gross value in money of the goods or properties sold, bartered or exchanged, such tax to be paid by the seller or transferor: Provided, that the value-added tax on the sale of fuel as used in Section 148 of this act shall be suspended when the Dubai crude oil price based on Mean of Platts Singapore (MOPS) reaches or exceeds eighty dollars (USD 80) per barrel.”
Section 107, meanwhile, will state: “(A) In General. – There shall be levied, assessed and collected on every importation of goods a value-added tax equivalent to twelve percent (12%) based on the total value used by the Bureau of Customs in determining tariff and customs duties plus customs duties, excise taxes, if any, and other charges, such tax to be paid by the importer prior to the release of such goods from customs custody: Provided, That where the customs duties are determined on the basis of the quantity or volume of the goods, the value-added tax shall be based on the landed cost plus excise taxes, if any: Provided, further, that the value-added tax imposed on the importation of fuel as used in Section 148 of this act shall be suspended when the Dubai crude oil price based on Mean of Platts Singapore (MOPS) reaches or exceeds eighty dollars (USD 80) per barrel.”
Section 148, on the other hand, will be amended to include the following: “Sec. 148. Manufactured Oils and Other Fuels. — There shall be collected on refined and manufactured mineral oils and motor fuels, the following excise taxes which shall attach to the goods hereunder enumerated as soon as they are in existence such as: the excise tax on fuel as imposed in this section shall be automatically suspended when the average Dubai crude oil price based on MOPS reaches or exceeds eighty dollars (USD 80) per barrel.”
