ASEANEWS HEADLINE-ECONOMY | House OKs Marcos Jr. special power on fuel excise tax
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On 2nd reading; Senate panel eyes OK ‘in principle’
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MANILA, Philippines — President Marcos has come closer to wielding special powers in cushioning the impact of soaring oil prices, with the House of Representatives’ approval yesterday on second reading of a measure authorizing him to suspend or reduce the excise tax on fuel.
House Majority Leader and Ilocos Norte Rep. Sandro Marcos, one of the authors of the measure along with Speaker Faustino Dy III, said House Bill (HB) No. 8418 is built for moments when global disruptions push fuel prices rapidly and the government needs to respond with speed and precision to spare Filipinos from a heavy burden.
“This bill gives the President a measured tool to cushion that shock, with clear triggers, clear limits and clear reporting when the prices of fuel and basic commodities get too high. This is a protection of the people for the sudden increase of prices in basic commodities,” Congressman Marcos said in a statement.
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At the Senate, a similar measure is now up for plenary approval “in principle,” according to Sen. Pia Cayetano, chairperson of the committee on ways and means.
She said she aims to sponsor a consolidated bill on the measure before the plenary as early as next Monday.
HB 8418, authorizing the President to suspend or reduce excise taxes on petroleum products during national or global economic emergencies, amends Section 148 of the National Internal Revenue Code to allow the President to suspend or reduce fuel excise taxes, 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.
During plenary deliberations, Marikina Rep. Miro Quimbo, chairman of the House committee on ways and means, defended the measure on the floor, stressing that the authority is not open-ended and that there are safeguards meant to protect both consumers and fiscal stability.
Under the bill, the President may exercise the authority only upon recommendation of the Development Budget Coordination Committee and in coordination with the Secretary of Energy, and only if one of two conditions is present.
First trigger
The first trigger is when the Dubai crude oil price, based on the Mean of Platts Singapore, reaches or exceeds $80 per barrel for one month immediately before the order to suspend or reduce is issued.
The second trigger is when there is a declared state of national emergency or calamity and it results in extraordinary increases in domestic pump prices, as certified by the Secretary of Energy, establishing a formal basis for action beyond ordinary market movements.
The President’s suspension or reduction may be applied to specific petroleum products and may be calibrated as a full suspension or partial reduction, depending on the conditions that caused the price surge and the scope of relief needed.
To prevent abuse and to protect government revenues, the measure sets a firm duration limit of up to six months per suspension or reduction, unless Congress extends or terminates earlier through a joint resolution.
The bill also requires that the suspension or reduction be lifted once the extraordinary conditions no longer exist. It also provides for the automatic reinstatement of the excise tax rates after the period ends without need of further government action.
Marcos said the House moved the bill with urgency as part of the chamber’s push under Dy’s leadership to keep policy tools ready for real world shocks.
“Under Speaker Dy, we are moving with discipline and urgency because the costs that hit families do not wait for politics. Our job is to keep options ready, act when the triggers are met and make sure relief reaches people without delay,” Marcos said.
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The discussions on the measure at the Senate centers on the specific economic conditions that would activate and deactivate the tax relief.
“There are just a few details on when the trigger is. When will the President be given that authority to suspend or reduce the excise tax? And then, when will this authority end? So that’s the question that DOE and DOF have been working on,” Cayetano explained.
Despite pending technicalities, the senator assured the public that the upper chamber is prepared to move swiftly once the lower house acts.
“But we’ll be ready to sponsor it as soon as the House gives us their version,” she said.
The ways and means committee is currently consolidating at least 10 Senate bills seeking the suspension or reduction of fuel excise taxes to mitigate the economic fallout from the geopolitical crisis.
DOF backs move, but…
At yesterday’s hearing, the Department of Finance said it was supportive of the measures, whether to suspend or reduce excise tax.
But DOF Undersecretary Karlo Adriano said that suspending the tax from May to December would cost the government P136 billion in foregone revenues, including Value Added Tax (VAT) losses.
Sen. Sherwin Gatchalian pointed out that since the 2026 national budget is already programmed, losing that much revenue leaves the executive branch with only two options: borrow more money or slash spending.
Budget Assistant Secretary Romeo Balanquit told the panel that because most of the 2026 budget had already been released to agencies, the President may be forced to exercise his power to impound or freeze unobligated funds to cover the deficit.
“What could happen is there could be some action of the President, some unobligated or unreleased funds may be impounded… it’s a possibility given this scenario we’re in right now,” Balanquit said.
Outside the House of Representatives’ complex, members of the Alliance of Concerned Teachers (ACT) protested the Marcos administration’s move to seek emergency powers to reduce excise taxes on fuel.
“Even though there is still an adequate supply of oil, prices are rising due to speculation and the control of big oil companies in the global market. Due to oil deregulation, the government is almost powerless to stop the continuous price increases. The ones who suffer are ordinary citizens—including teachers—who continue to pay for a crisis they did not create,” ACT chairperson Ruby Bernardo said.
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“If the oil industry remains deregulated, there is no guarantee that any tax reduction will be directly felt by the people. It could only be eaten up by the continued increase in prices in the global market or by the increased profits of the companies,” Bernardo added.
Meanwhile, economist Emmanuel Leyco said in an interview with dzBB than 50 percent of Filipinos would be severely affected amid the warning of the Department of Economy, Planning and Development (DEPDev) that the inflation could accelerate to as much as seven percent should the conflict in the Middle East drag on.- Diana Lhyd Suelto, Bella Cariaso
