By Chino S. Leyco
The Phoenix Petroleum Philippines said the company is willing to prepay the excise tax on fuel once the Duterte administration’s proposed tax reform measure is passed into law.
Dennis Uy, Phoenix Petroleum president and chief executive said they support the government’s proposed tax reform program, which is now pending in the House of Representatives.
“We support the administration’s plan on tax reforms,” Uy said during the company’s annual stockholders meeting last week.
“One of the ways we can support the government’s revenue-generating efforts is to pre-pay the excise taxes for imported fuel and petroleum products for a period,” he added.
Uy believes the proposed tax reform program is seen to increase government revenues, improve the business environment, and sustain economic growth.
The Department of Finance (DOF) has proposed adjusting the excise taxes on automobiles and petroleum products, implementing fuel marking, and reducing personal income taxes as part of its comprehensive tax reform package.
But higher taxes, the DOF also assured that industries will continue to grow, and consumers will benefit from higher take-home pay through lower income taxes.
Phoenix Petroleum is the fastest-growing and number one independent oil company in the country.
Earlier, Finance Undersecretary Karl Kendrick T. Chua said the government is losing billions of pesos in potential revenues annually owing to tax-free and outdated levies imposed on petroleum products.
Chua said an estimated P145 billion in yearly revenues were lost because gasoline excise taxes remained the same in the last two decades, while diesel products have been tax-free for the past 12 years.
Losses from petroleum goods are estimated at around 1.0 percent of the country’s gross domestic product, the official said.
To plug the leakages, the Duterte administration wants to overhaul the tax system on petroleum products.
The government is now proposing to adjust fuel excise taxes and later indexing them to inflation, along with the proposals to lower personal income tax (PIT) rates and provide direct cash transfers to vulnerable sectors.
The DOF is proposing to adjust the fuel excise tax to around P6 per liter.
But even with the adjustments, Chua believes the retail prices of gasoline and diesel will still be much lower than the rates during the oil price shocks of 2011 and 2012.