Manila: The House of Representatives is scheduled to approve this week the measure granting President Ferdinand Marcos Jr. the authority to temporarily cut or suspend excise taxes on petroleum products. House Bill No. 8418, certified as urgent by the President, is subject to strict conditions and time limits, so relief can be activated without waiting months for a new law in the middle of a crisis.
According to Philippines News Agency, House Majority Leader Ferdinand Alexander 'Sandro' Marcos of Ilocos Norte stated that HB 8418 was crafted specifically for moments when an overseas crisis quickly turns into a local burden at the pump, in public transport, in the market, and on the dinner table. "The House is moving to address an oil price crisis. This bill gives the President a lawful and time-bound way to cut or suspend fuel excise taxes so relief can reach the public before higher oil prices trigger a wider increase in fares, food, and other basic expenses," Marcos said in a statement Sunday evening.
Marcos, along with Speaker Faustino 'Bojie' Dy III, has pushed the measure as part of the House's effort to keep the government prepared for price spikes tied to international events. These include conflict-driven disruptions in the global oil supply that can escalate the costs of basic commodities. The proposal aims to ease a tax burden that has become heavier as global oil prices rise.
Under current law, excise taxes are part of the retail price of petroleum products, leading to increases in transportation, delivery, electricity generation, and goods' prices sold in markets and stores. HB 8418 authorizes the President, with recommendations from the Development Budget Coordination Committee and in coordination with the Secretary of Energy, to suspend or reduce the excise tax on fuel under specific conditions. This allows for rapid action while preserving safeguards and oversight.
One condition in the bill is when the average Dubai crude oil price reaches or exceeds USD80 per barrel for one month immediately before the issuance of the suspension or reduction order. This threshold is intended to capture prolonged price pressure rather than short-lived market swings. Another trigger applies when the President declares a state of national emergency or calamity, resulting in extraordinary domestic pump price increases of petroleum products, as certified by the Secretary of Energy.
The measure allows for the suspension or reduction to apply to specific petroleum products and may be implemented as either a full suspension or partial reduction of the excise tax, based on prevailing conditions. To prevent abuse, the bill states that any suspension or reduction may be effective for not more than six months unless extended or terminated earlier by Congress through a joint resolution. The total aggregate period of suspension or reduction may not exceed one calendar year.
The bill also requires that any suspension or reduction be lifted once the conditions justifying it no longer exist, with the applicable excise tax rates automatically reinstated upon expiration without further executive or legislative action. The President's authority under the measure may be exercised only until December 31, 2028.
As an additional check, the bill mandates the President, through the Secretary of Finance, to submit a report to the House and Senate within 15 days from the issuance of the order and every month thereafter. The report should detail the factual basis for the action, the estimated foregone revenues, and the expected impact on inflation, fuel prices, and other economic activities.
The Department of Finance, Department of Budget and Management, Department of Economy, Planning and Development, Department of Energy, and Bangko Sentral ng Pilipinas, in coordination with the Bureau of Internal Revenue and Bureau of Customs, are directed to jointly issue the implementing rules and regulations within 15 days from the law's effectivity.
