Published January 7, 2020, 10:00 PM By MYRNA M.
VELASCO
The Department of Energy (DOE) has
warned oil companies that it will go to the extent of checking their
importation notices if they will attempt to enforce higher excise taxes on
their old stocks or inventories.
“DOE may have the option to check your
importation notices to check compliance,” the agency has stipulated in its
notice to the players of the deregulated downstream oil sector.
The energy department similarly
directed the oil firms to advise their dealers “that pump prices should only
reflect stocks that have actually had the new excise tax rates imposed.”
The DOE further qualified that “old
stocks should be sold on the old excise tax rate,” in reference to the last
excise tax rates implemented last year.
The anticipated increases in excise
taxes for petroleum products – which may kick off by second to third week of
this month – is courtesy of the third tranche prescription of the Tax Reform
for Acceleration and Inclusion (TRAIN) Act.
The excise tax increases will be
P1.00 per liter for gasoline or P1.12 per liter with the inclusion of value
added tax (VAT); P1.50 per liter for diesel (or P1.68 per liter with VAT); and
P1.00 per liter for kerosene (or P1.12 per liter with VAT).
This is already the third year that
pump prices have been rising at the start of the year because of the tax reform
package of the Duterte administration. The first excise taxes hike was in 2018;
then the second batch was January last year.
To establish the remaining volume of
inventories of the oil companies that shouldn’t be levied with higher excise
taxes yet, the DOE has required them last month to submit data on their
inventories up to December 31, 2019.
As directed, “concerned oil
companies, owners, operators or lessees of storage depots, as well as producers
and importers of denatured alcohol for motive power/bioethanol fuel shall
submit duly notarized inventories of all petroleum products and denatured
alcohol/bioethanol fuel as of midnight of December 31.”
Increases in pump prices in the
coming weeks are set with extreme caution as such coincides with the sudden
upswing in prices in the world market due to the escalating geopolitical
tension between the United States and Iran.
In just the initial trading days of
oil in the international market, prices of benchmark Dubai crude for Asian
market had already been up by roughly US$2.0 per barrel – reaching a high of
more than US$69 per barrel from last week’s leaner average of US$67 per barrel.
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