Excise tax, VAT suspension sought after ninth week of oil price hikes
by Lloyd Manango
Transport and labor groups call for oil excise tax and Value Added Tax (VAT) suspension as local pump prices threaten to rise for more than nine straight weeks since the start of 2022 following the outbreak of the Ukraine-Russia conflict.
Ninth straight week of OPH
Philippine oil giants Petron, Caltex, Shell, Flying V, and Seaoil implemented on Tuesday, March 1, a price increase for gasoline by P0.90, diesel by P0.80, and kerosene by P0.75, totalling to a per-liter hike of P7.95 for gasoline, P10.20 for diesel, and P9.10 for kerosene since January, according to the Department of Energy (DOE).
The protesters, led by Pinagkaisang Samahan ng mga Tsuper at Operator Nationwide (PISTON), Anakpawis Partylist, and Kilusang Mayo Uno said that the rising prices of oil would translate to an increase in market prices, further shrinking the relative value of the P310-P537 minimum wage in the country.
“Kapag ang presyo ng langis ang iyong ginalaw, kahit sa kabila ng pagtatakda ng [Suggested Retail Price] SRP, hindi mo mapipigilan na tumaas ang presyo ng batayang bilihin at serbisyo,” Makabayan senate bet and labor leader Elmer “Ka Bong” Labog said.
(If you increase the price of oil, even if there is a SRP, you cannot prevent an increase in the prices of basic goods and services.)
The suspension of the excise tax on oil amounting to P10 per liter for gasoline, P6 per liter for diesel, and P3 per kilo of LPG and the 12% VAT on petroleum products would mark the first significant rollback of oil prices since 2021.
Oil supply insecurity and deregulation
The DOE said that the series of price hikes is expected to continue in the coming weeks due to global supply insecurity fears as Russia, a major supplier of oil, conducts its military operations in Ukraine, a key thoroughfare for Russian oil pipelines to Europe.
Per-barrel prices of US crude oil already hit past $109, the highest since 2013, as oil companies and investors brace for supply woes amid the conflict in East Europe, sending shockwaves across the global oil market.
However, progressive groups explained that while the global geopolitical situation is a factor, the cartelization and deregulation of the Philippine oil industry is the primary driver of oil price hikes.
“Gagawin na naman nilang palusot [ang digmaan], na walang pumapasok na suplay ng langis dito at magiging batayan ng tuloy-tuloy na pagtaas ng presyo ng langit at produktong petrolyo,” Labog asserted.
(They will again use the conflict as an excuse, that there is no oil supply coming into the country, and this will be the basis for continuous price hikes for oil and petroleum products.)
As the Duterte government readies a P2.5 billion fuel subsidy to help the transport sector absorb the shock of the coming oil price hikes, Anakpawis highlighted the need for the government to regulate oil prices by taking back control of the downstream oil industry.
“Dapat parusahan ang mga kumpanya ng langis na nagmamanipula at nagsasamantala ng presyo,” the Partylist said in a press release.
(Oil companies manipulating and exploiting prices should be punished.)
