QUEZON CITY, Philippines (Eagle News) — Several lawmakers asked the Department of Energy (DOE) and other government agencies to be vigilant and monitor oil companies that implemented price increases before the implementation date provided in the Tax Reform law.
On January 1, fuel prices increased due to global supply concerns and not because of the Tax Reform for Acceleration and Inclusion (TRAIN) Law.
Eastern Samar Representative Ben Evardone asked the DOE and its task force formed with the Department of Justice and the Philippine National Police, to be strict in its monitoring.
He urged the government to activate this task force “to strictly monitor oil companies for possible violation of the existing laws.”
The DOE said last week’s international oil trading could lead to increase in domestic prices of gasoline, diesel and kerosene.
Energy undersecretary Felix William Fuentebella said the DOE’s monitoring noted that oil prices soared to two-and-a-half-year highs as a result of an explosion of a crude pipeline in Libya this week and of voluntary supply cuts by the Organization of the Petroleum Exporting Countries (OPEC).
Deputy House Speaker Miro Quimbo, on the other hand, asked for spot audits of old oil inventories.
Quimbo also warned oil companies that they can be charged with economic sabotage if they take advantage of the law.
The DOE, through the Oil Industry Management Bureau (OIMB), said that the new excise tax rates will not and should not apply to old petroleum stocks.
This should not be used as justification for price adjustments, it said.
“The OIMB has issued an advisory to petroleum products stakeholders not to levy new excise tax rates on old stocks, considering that excise taxes are levied upon importation and not at the point of sale to the consumers,” Assistant Secretary Leonido Pulido III said.
The Department of Finance said “oil increase done by companies on Jan. 1 might be considered profiteering” because the “excise is paid at the port of importation or refinery.”
It would thus take a few days for the 2017 oil stock to be used up, the DOF said.
The energy department urged the public to report any unlawful price adjustments to info@doe.gov.ph or to Consumer Welfare and Promotion Office at tel. no. 479-2900 loc. 329.
Under the TRAIN law, gasoline is subject to higher excise tax of P7 per liter from the previous P4.35, while for diesel and auto liquefied petroleum gas (LPG), the new tax rate is P2.50 per liter; and for kerosene, P3.