By GENALYN KABILING
THE government is hopeful that world oil prices would not further increase but is prepared with a contingency plan to temper the soaring cost.
Presidential spokesman Harry Roque said the tax reform law allows the government to suspend the next increase in fuel excise tax rate when the price of Dubai crude oil reaches a certain level.
Roque issued the statement after local oil companies implemented another round of price increase amid continued rise in global prices.
“Nasa batas po iyan, kapag umabot ng certain amount wala na pong gagawin ang kahit sino, automatic po masu-suspinde iyon. So, sana po hindi umabot doon,” Roque said in a Palace news conference last Monday.
“Noong binuo po iyong batas, eh meron din po silang foresight na baka nga tumaas ang langis at kinakailangan i-suspend iyong collection ng additional excise taxes. So, nasa batas na po iyan, he said.
Under the Tax Reform for Acceleration and Inclusion (TRAIN) law, the next fuel tax rate increase will be suspended if the three-month average of Dubai crude hits $80 per barrel. The tax-freeze provision aims to protect the public from rising prices of oil products.
A provision of the law states “For the period covering 2018 to 2020, the scheduled increase in the excise tax on fuel as imposed in this section shall be suspended when the average Dubai crude oil price based on Mean of Platts Singapore for three months, prior to the scheduled increase of the month reaches or exceeds $80 per barrel.”
Last December, the President signed Republic Act No. 10963 or the TRAIN law that allows lower personal income tax to offset higher taxes on fuel, cars, and sweetened beverages.
Some groups have called for the suspension of the TRAIN implementation to mitigate the impact of soaring consumer prices on the economy and the people. The country’s inflation has rise to 6.4 percent last August, prompting authorities to authorize the importation of more rice, fish and meat to boost supply and bring down prices in the market.