The Philippine government has yet to set a timetable for deciding whether to cut or suspend fuel excise taxes, even though oil prices have already breached the threshold that allows such relief, as pump prices climbed sharply for a third consecutive week.

Diesel rose by P8.82 a liter on Tuesday, gasoline by P4.88 and kerosene by P6.47, according to the Department of Energy (DoE). The latest adjustments brought the cumulative increase over the past three weeks to P18.31 a liter for diesel, P15.25 for gasoline and P16.67 for kerosene.

Palace Press Officer Clarissa A. Castro said the economic team was close to completing its recommendation on whether to suspend or reduce fuel excise taxes and expected to submit it to President Ferdinand R. Marcos, Jr. this week. She did not indicate when a decision might come.

“If it is really necessary, the President will act on it immediately,” Ms. Castro told a news briefing in Filipino.

The DoE on Sept. 15 certified that Dubai crude averaged $99.41 a barrel from Aug. 13 to Sept. 11, exceeding the $80 threshold required under Republic Act No. 12316 for the government to consider temporarily cutting or suspending fuel exc taxes. The certification has been submitted to the Development Budget Coordination Committee, which must issue a recommendation before the President can exercise the authority.

Because excise taxes form part of the retail pump price, a suspension or reduction would directly trim what consumers pay at the pump, even as world-price movements continue to drive the weekly adjustments announced by the DoE.

Under the law, the President may reduce or suspend excise taxes on specific petroleum products for as long as three months at a time once the one-month average Dubai crude price reaches at least $80 a barrel. The authority may be used for an aggregate period of up to one year and expires at the end of 2028.

Mr. Marcos invoked the power in April, suspending excise taxes on liquefied petroleum gas, subject to certain exceptions, and on kerosene, excluding aviation fuel, for three months. Dubai crude had averaged $93.71 a barrel over the past 30 days.

The latest round of pump-price increases has also renewed pressure for higher public transport fares. Ms. Castro said a possible fare increase remained under discussion as the government weighed the needs of transport operators against the impact on commuters.

“That matter is still being discussed,” she said. “It would be a heavy burden to implement everything all at once.”

Transportation Secretary Giovanni Z. Lopez regards a fare increase as a last resort, Ms. Castro said. “We hope that a fare hike remains our last resort,” she said, citing Mr. Lopez. “The DoTr (Department of Transportation) continues to implement initiatives to mitigate the impact of rising fuel prices, such as fuel discounts and toll-free travel for buses.”

The government is likewise considering targeted assistance for transport workers through the Department of Social Welfare and Development’s Assistance to Individuals in Crisis Situations program, she added.

Existing measures include doubled fuel discounts for traditional jeepney and UV Express drivers, raised to P20 a liter and capped at 150 liters a week. Provincial buses have been granted free passage on several Luzon expressways, while some public transport terminal fees have been waived.

Transport group Pagkakaisa ng mga Samahan ng Tsuper at Operator Nationwide said it would push through with a two-day nationwide strike on Sept. 29 and 30 to protest spiraling fuel prices. The group is seeking higher jeepney fares, the removal of value-added and excise taxes on fuel and basic goods, lower pump prices and the repeal of the Oil Deregulation law. Ms. Castro said the government would not prevent the group from holding the strike.

Energy Secretary Sharon S. Garin said fuel prices were likely to remain above levels seen before the latest Middle East conflict through the end of the year unless tensions ease. Speaking on Monday, she said that given currency exchange rates and the Middle East war, the DoE does not expect oil prices to return to pre-war levels this year, adding that prices are likely to stay high at least until Christmas unless a peace deal is reached.

— Erika Mae P. Sinaking

Source: BusinessWorld