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Rappler Business

Marcos suspends excise taxes on LPG, kerosene anew

The tax relief does not extend to gasoline and diesel, as Finance Secretary Frederick Go says this would 'not be progressive' because higher-income consumers who use more of the two fuels would capture more of the benefit

Context & Analysis

For many Filipino households, LPG is less a commodity than a monthly necessity: it powers cooking in urban apartments, provincial homes, and small food businesses whose margins depend on stable refill prices. The renewed suspension of excise taxes on LPG and kerosene therefore lands where it can be felt quickly at the kitchen table and in the ledger of sari-sari stores, eateries, and service providers that rely on gas for heat or cooking. It is a narrower form of relief than a broad fuel tax cut, but it targets one of the most visible components of everyday spending.

The targeted scope is as important as the relief itself. Cooking fuel is a household staple with limited substitutes for many low-income families, while mobility-related fuels are tied to commuting, logistics, delivery, and income-linked consumption. That split lets policymakers address affordability without subsidizing transport-heavy demand across all income groups. It also reflects a familiar Philippine policy tension: keep basic necessities affordable, protect vulnerable households, and avoid creating incentives that reward higher consumption or heavier vehicle use.

For businesses, the effect will be uneven. Food preparation, hospitality, and small retail operations may see modest pressure relief if cylinder prices fall. But companies whose costs are driven by delivery, passenger transport, or supply-chain movement will not gain direct help from this measure, especially if global crude prices stay volatile or local refining margins tighten. The suspension also matters for fiscal planning: it shows the administration is willing to forgo excise revenue in a selective way rather than open a wide front on energy taxes.

What to watch next is duration and scope. If relief remains short-term, businesses may treat it as a temporary cushion rather than a structural change. If pressure builds from typhoons, inflation, or rising global oil costs, the government may face calls to extend support or revisit other fuel taxes. For now, the policy reads less as a full energy-price reset and more as a calibrated attempt to protect low-income households while keeping transport-related demand and tax receipts intact.

Analysis by IJE Software — original commentary on the story above.

This is an excerpt. Read the full article at the original source:

Source: rappler.com

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