Senator Francis ‘Chiz’ Escudero on Wednesday (March 4) called for amendments to the Tax Reform for Acceleration and Inclusion Law to grant the President standing authority to suspend or reduce excise taxes and value-added tax (VAT) on fuel whenever global oil prices exceed the benchmark assumptions for Dubai crude set in the government’s Budget of Expenditures and Sources of Financing (BESF).
Escudero said the existing safeguard under Republic Act No. 10963 remains too restrictive, as it requires specific conditions to be met before fuel excise taxes can be suspended. He stressed that broader amendments are necessary to ensure the government can respond more quickly to oil price shocks caused by force majeure events such as wars or global crises.
The veteran lawmaker reiterated that he has long supported giving the President automatic authority to suspend tax impositions in order to protect consumers from sudden spikes in fuel prices.
“The law should be amended to automatically grant the President the power to suspend or reduce excise and VAT rates when oil prices exceed the estimated Dubai crude range used in the BESF, which serves as the basis for the government’s budget assumptions,” he said.
Escudero also warned that the government should not benefit from increased excise tax collections when higher fuel prices are driven by extraordinary circumstances.
“Government should not enjoy windfall revenues from excise taxes at the expense of the public due to price increases brought about by force majeure,” he added.
His proposal comes after President Ferdinand Marcos Jr. said he would ask Congress to grant emergency powers that would allow the temporary reduction of excise taxes on petroleum products if Dubai crude oil prices exceed $80 per barrel, a move intended to cushion the impact of rising global oil prices on Filipino consumers.
While Escudero welcomed the President’s plan to seek emergency authority, he emphasized that a permanent amendment to the law would provide a more practical and timely solution.
“We should not have to wait for every crisis to go through Congress before action can be taken. The law itself should already give the President the automatic authority to respond when circumstances require it,” he said.
