Higher gas prices to greet Filipinos in January 2019

CLARK FREEPORT, Philippines — There will be a big fuel price rollback today, but higher pump prices are expected at the start of 2019 as the increase in the excise tax on petroleum products kicks in.

The Department of Energy (DOE) has asked oil industry players to first empty their 2018 oil inventories before applying the higher tax and raising pump prices. But this could mean a delay of only a week or two in the increase.

In a statement, Energy Secretary Alfonso Cusi yesterday said his agency, in close coordination with the Department of Finance, Bureau of Customs and Bureau of Internal Revenue, has devised a mechanism to closely monitor existing oil inventories following the implementation of the second tranche of Tax Reform for Acceleration and Inclusion (TRAIN) law on Jan. 1.

“We are ready to implement the second tranche of TRAIN, which imposes additional excise taxes on various commodities like petroleum products by New Year,” Cusi said.

He added, “We have to ensure the proper implementation of the second tranche of TRAIN because the new collection will be used to support our ‘Build Build Build’ programs, free tuition and medical assistance for our kababayans.”

The second tranche of TRAIN imposes an additional P2.24 per liter of gasoline and diesel, consisting of P2 in excise tax and P0.24 in value-added tax (VAT).

With the imposition of the additional excise tax, Cusi said they are stringently looking at the 2018 inventories of oil companies to protect consumers from unjust trading and profiteering.

Cusi stressed “the sale of old stocks, referring to the remaining balance of the inventory” ending Dec. 31 of this year and which is not covered by the second tranche of excise taxes, should not include the additional tax.

Rollback

While additional taxes will be imposed on fuel, a major price rollback will be implemented by Unioil Philippines Inc., which said it will reduce gasoline prices by P1.30 per liter and diesel prices by P1.80 per liter starting 6:01 a.m. today.

“This is to reflect the changes in the international oil market,” it said.

Other companies have yet to announce their respective price changes. 

This is the 11th consecutive week of reduction for diesel and kerosene, and the third week for gasoline. –  With Danessa Rivera