MANILA, Philippines — President Ferdinand “Gomes” Marcos Jr. is officially seeking emergency powers from Congress to reduce excise taxes on petroleum products. The move is a “precautionary measure” to protect Filipino consumers as escalating tensions in the Middle East threaten to send global oil prices skyrocketing.
- The Trigger: The President intends to exercise this authority if Dubai crude exceeds $80 to $90 a barrel and remains at that level for at least two months.
- The Goal: To provide the Executive branch with the flexibility to act swiftly during a crisis. Finance Secretary Frederick Go emphasized that the power would not be “automatically exercised” but serves as a ready policy tool.
- Potential Relief: Industry experts suggest that a full suspension of excise taxes could lower diesel prices by ₱6 per liter and gasoline by ₱10 per liter, with additional savings from the corresponding reduction in Value-Added Tax (VAT).
While the move offers relief to consumers, it carries a heavy fiscal cost. Senator Sherwin Gatchalian warned that a year-long suspension of fuel excise taxes could result in a massive revenue shortfall of approximately ₱300 billion. He also raised concerns about “equity,” noting that wealthy individuals with multiple vehicles would benefit more than those in need.
The urgency follows threats from Iran to close the Strait of Hormuz—the world’s most critical oil chokepoint—following military strikes by the U.S. and Israel.
- Global Impact: Roughly 15 million barrels of oil per day (one-fifth of the world’s supply) pass through this strait.
- PH Vulnerability: The Philippines is particularly exposed, as 98% of its imported crude oil originates from the Middle East.
Beyond tax cuts, the President has directed several other strategies to mitigate the crisis:
- Staggered Hikes: Asking oil companies to implement price increases gradually rather than in large single jumps.
- Subsidies: Reactivating the Pantawid Pasada program for PUV drivers, farmers, and fisherfolk.
- Transport Relief: Exploring free bus rides on major routes and freezing public transport fares.
- Energy Conservation: A mandatory directive for all government offices to save energy, with a general appeal to the public to do the same.
Several senators, including Joel Villanueva and Bam Aquino, have already filed bills (SB 1922 and SB 1923) to grant the requested authority, signaling strong legislative support for the emergency measure.