1-year suspension of specific tax on oil proposed

Energy Secretary Mario V. Tiaoqui is proposing that the reduction of specific taxes on petroleum products be made effective for one year. At the same time, Tiaoqui’s suggesting that the President be granted "special powers" by Congress to reduce specific taxes whenever there is a need to.

The reduction in specific or excise taxes was recommended by government and the energy sector as open of several measures to forestall any increases in local pump prices.

The energy secretary said that allowing for a longer period and a flexible reduction in the amount of the reduction instead of a three-month reduction based on exact figures would allow government more "flexibility."

"We want more flexibility, maybe one year," he told newsmen yesterday at a forum in Makati.

He said Congress may pass an order giving President Estrada special powers to adjust these specific taxes instead of waiting for the legislature.

Tiaoqui said the Cabinet wants more flexible pricing of the taxes instead of the original proposal of fixed rates. He refused to elaborate.

Earlier, Mr. Estrada signed Executive Order (EO) 314 suspending the three-percent tariff on imported crude oil and refined petroleum products for three months effective Nov. 10 this year.

The proposed suspension of the specific taxes on certain petroleum products will result in a monthly revenue loss for government of P2.067 billion.– Ted Torres