BAGUIO CITY– Senator Sherwin Gatchalian underscored that the proposal to suspend the excise tax on oil and other fuel products is no longer needed with the recent drop in the prices of oil products in the world market as a result of the uncovered new Coronavirus Disease 2019 (COVID-19) variant in South Africa.
Gatchalian, who was in the city over the weekend, stated that based on the latest developments in the world market, oil prices are going down as evidenced by the decrease in fuel prices in the country over the past 4 weeks, thus, the proposed suspension of the implementation of excise tax on oil and other fuel products might no longer be enforced.
The chairman of the Senate committee on energy pointed out that in all indications, the global oil prices are on a down trend that will also result to the reduction in local oil prices which will surely be good for the country’s economy in the coming months.
Earlier, concerned sectors have proposed to the government to suspend the implementation of the excise tax on oil and fuel products contained in the Tax Reform for Acceleration and Inclusion (TRAIN) Law to help mitigate the effects of the 10-week successive increase in oil prices that impacted on the prevailing prices of basic commodities.
Senator Gatchalian explained that since the reports on the new COVID-19 variant had spread like fire globally, oil prices in the world market significantly dropped over the past several days which would mean that there will also be a similar trend in the country’s oil prices in the coming weeks which will be advantageous to the transport sector and industries heavily relying on fuel to sustain their respective operations.
However, he claimed that there is a need for the government to study other possible options to mitigate the effects of future oil price increases which it can roll out once is a sudden increase in oil prices for a number of weeks.
According to him, the Senate committee on energy was supposed to conduct consultations with the concerned government agencies and the affected stakeholders on the proposal to temporarily suspend the implementation of the excise tax on oil and other fuel products to mitigate the effect of the 10-week oil price hike but oil prices started to significantly drop over the past 4 weeks.
Gatchalian assured concerned stakeholders that the Senate committee on energy will continue to monitor the latest developments in the world market aside from drawing up possible mitigating measures to ensure the government’s readiness to deal future developments affecting oil prices that will impact on the prevailing local oil prices so as not to affect the oil-reliant sectors that ultimately pass on added costs to consumers.
For the past several decades, various sectors had been lobbying for Congress to repeal the controversial Oil Deregulation Law to prevent the unabated increases in oil prices that tend to heavily impacted on the country’s overall economy. By HENT