Gasoline stations ordered to submit inventories for fuel marking scheme

MANILA, Philippines — The Bureau of Internal Revenue (BIR) has ordered all gasoline stations nationwide to submit an inventory of all their petroleum products in line with the fuel marking program of the government.

Internal Revenue Commissioner Caesar Dulay issued revenue memorandum circular 2-2020, mandating all revenue district offices (RDO) to require all gasoline stations to submit a sworn declaration of inventory of diesel, gasoline, and kerosene as of Dec. 31, 2019.

“In preparation for the field testing aspect of the fuel marking program, all gasoline stations nationwide are required to submit a sworn declaration statement of inventory identified per branch as of Dec. 31, 2019 on or before Jan. 15, 2020,” Dulay said.

Dulay said the inventory shall specify the volume and type of petroleum products – namely, diesel, gasoline and kerosene – and shall be submitted to the RDO or Large Taxpayers Division where the principal place of business is registered.

He said the concerned RDO shall consolidate the submitted reports and transmit them to the Excise Large Taxpayers Field Operations Division (ELTFOD) on or before Jan. 31.

“This report shall state whether the inventory has been marked or not to serve as the initial database for monitoring and field testing,” Dulay said.

The fuel marking program is part of Republic Act 10963 or the Tax Reform for Acceleration and Inclusion (TRAIN) law.

 Under the program, petroleum products for domestic consumption with proof of payment of taxes will be injected by markers.

Last August, the Bureau of Customs (BOC) formally commenced the implementation of the program, with the first live marking of petroleum products at Seaoil Bulk Terminal in Mabini, Batangas.

 The BOC expects all fuel companies to be compliant with the fuel marking program by Feb. 3, 2020 as it starts conducting random field tests in oil facilities and depots nationwide.

The fuel marking program seeks 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.

Estimates from the DOF showed that the government loses about P40 billion annually due to oil smuggling. The DOF earlier said the government wants to plug at least half of this or P20 billion through fuel marking.