While the increase could be substantial, Finance Secretary Carlos G. Dominguez III explained that it is the most prudent way to compensate for several years of government’s inaction over its outdated fuel tax rates. Substantial hike in fuel tax mulledThe Department of Finance (DOF) is determined to “substantially” hike taxes on petroleum products as their current rates have already been eroded by inflation after nearly two decades of zero adjustment. “We have to because that thing [excise tax rates on petroleum] was set in 1997 at P4.50 per liter,” Dominguez told reporters. The DOF now plans to adjust the excise tax rates on petroleum by indexing the present fuel pump prices to average inflation since 1997. Diesel products, meanwhile, will be taxed P6 a liter, removing its excise tax exemption status.

Source: Manila Bulletin July 17, 2016 14:03 UTC