Excise taxes on oil products to remain

MANILA, Philippines — The Department of Finance (DOF) has no plans to remove the excise taxes on petroleum products, even as inflation soared to a 40-month high in April.

DOF chief economist Gil Beltran said yesterday pump prices would continue to go up as long as the international market faces supply pressure due to geopolitical tensions.

But Beltran said it would be a mistake for the government to suspend excise taxes on fuel because it would favor mostly the wealthy.

“Higher energy prices in the world market ultimately get translated into higher local pump prices. However, it would be a policy mistake to suspend fuel taxes since it will be the top 10 percent of the population that will gain the most as they account for nearly half the fuel consumption in the country,” he said.

Beltran said the government should instead pursue its targeted measures in responding to the impact of the price hikes across petroleum products.

He said the government should sustain the cash transfer program for the vulnerable sectors to mitigate the impact of rising consumer prices.

In March, the Department of Budget and Management issued P3 billion worth of fuel subsidies for public utility vehicle (PUV) drivers as well as farmers and fishermen.

A total of P2.5 billion was released to the Department of Transportation for the distribution of cash cards to at least 377,443 PUV drivers, including delivery riders and ride-hailing drivers.

Also, P500 million was transferred to the Department of Agriculture for the grant of fuel discounts to farmers and fishermen who own farming or fishing equipment, either individually or through organizations.