Roxas: Gov't stonewall on oil VAT suspension "unjust, oppressive"

With crude oil prices continuing to break records, Senator Mar Roxas renewed his call for the suspension of the value-added tax (VAT) on oil and petroleum products to curb domestic price shocks that have begun to hurt consumers.

"Oras na para i-suspinde ang VAT sa langis, para bigyan ng ginhawa ang mga mamimili sa panahong pataas nang pataas ang presyo ng bilihin (it's time to suspend the VAT on oil to give consumers relief at a time when prices of goods continue to increase)," he said.

"For the government to continue charging a 12% VAT on oil at this time is simply unjust. For the government to continue making the people shoulder what should otherwise be collected from big-time tax evaders and smugglers is simply oppressive," he stressed.

The chairman of the Senate Committee on Trade and Commerce said the world price of crude oil has already broken the $115-a-barrel mark due to increased demand from newly-industrialized countries and diminished production from oil exporters. Furthermore, local pump prices of diesel, gasoline and kerosene have increased seven times already since the start of the year.

"Still, the administration continues to stonewall on this issue, and other similar proposals to remove, suspend or lower VAT on other commodities. It would rather keep its revenues than ensure relief for consumers," he said.

"It only takes political will on the part of the administration to move its allies in the House to pass the proposed suspension of VAT on oil. After all, the people need their money in their pockets more today than the government needs its windfalls," he stressed.

"Any further delay or dilly-dallying from the administration to suspend the VAT on oil will be hard to justify," he stressed.

As per DOE data, the prevailing price of diesel is now at P40.44/L; gasoline at P47.46/L; kerosene at P43.02/L; and LPG at P566.14 per 11-kg tank. The temporary removal of the 12% VAT on oil would result in savings of P4.33 per liter of diesel, P5.09 per liter of gasoline, P4.61 per liter of kerosene and almost P61 per 11-kilogram tank of LPG.

Roxas filed Senate Bill 1962 seeking to suspend the VAT for a period of six months, and a similar bill was filed by Liberal Party stalwart Cavite Rep. Joseph Emilio Abaya in the House. The Senate Ways and Means committee has already held hearings on the Roxas bill but could not undertake any further action because according to the Constitution, all tax measures must emanate from the House.