#fuel subsidy

One of the more relevant excise taxes in public consciousness today would be the fuel excise tax, which is imposed over different petroleum products, owing to rising oil prices in the Philippines and overseas. However, why would the Filipino government choose to ramp up subsidies instead of suspending fuel excise taxes altogether, despite a rising call for suspension even among national candidates for the 2022 election? Such issues are not confined only in institutionalized programs, but also in stopgap measures like the fuel subsidy. Those in government, however, sees the potential effects of suspension from another perspective: the immediate relief expected from removing the fuel excise tax are likely to benefit the wealthier segments of society. The DOF argument rests on data indicating that the top 10 percent of Filipino households constitute around 49 percent of the nation's total fuel consumption. Consider the disparity in purchasing power, and in extension, fuel consumption. Remember that the fuel excise tax is fixed after reaching its full implementation in 2020. Depending on how global oil prices would hold for the rest of the year, the fuel VAT could increase between PHP 20.3 billion (at USD 100 per barrel) to PHP 37.5 billion (at USD 130 per barrel). Read more in our articles including "Why fuel excise taxes remain in the Philippines: equity or equality?" and "OPPO Reno15 Series 5G: Delivering the Complete Mobile Creator Experience".