Senator Loren Legarda on Monday, April 13, called on the government to immediately suspend excise taxes and value-added tax (VAT) on diesel and gasoline, warning that millions of Filipinos continue to struggle with rising fuel prices and the increasing cost of basic goods.
Her appeal followed the announcement by President Ferdinand Marcos Jr. to suspend excise taxes on liquefied petroleum gas (LPG) and kerosene, with the possible inclusion of diesel and gasoline set to be discussed in the next UPLIFT meeting.
“The suspension of taxes on LPG and kerosene is a big help because it directly affects households and the food service sector. But it is surprising that the main demand of the people, diesel and gasoline, which are used by farmers, drivers, and fishermen to earn a living, is still not being addressed,” Legarda said in a statement.
She pointed out that six weeks have already passed since the onset of the Middle East crisis, yet discussions on broader fuel tax relief remain unresolved.
“It has been six weeks since the crisis in the Middle East broke out, and is the discussion on this policy still not over?” she lamented.
Legarda stressed that suspending fuel taxes would provide immediate and nationwide relief, citing potential price reductions if excise taxes and VAT are temporarily removed.
“At a price of ₱150 per liter of diesel, there will be a saving of approximately ₱22.07 if the government temporarily removes the ₱6 excise tax and 12% VAT. Meanwhile, at gasoline at ₱90 per liter, there will be a reduction of approximately ₱19.64 per liter if the ₱10 excise tax and 12% VAT are removed,” she explained.
“If we act immediately, diesel at ₱150 will be ₱128 and gasoline at ₱90 will be ₱70. This will be felt directly by fishermen, farmers, drivers, and every Filipino family,” she added.
The senator rejected claims that targeted financial assistance would be more effective, arguing that delays and incomplete beneficiary lists often hinder the timely delivery of aid.
“The government is slow. We have seen it, it has been several weeks, and the aid is still not felt… Whereas if the tax is lowered, it will be felt directly,” she said.
She also dismissed arguments that fuel tax cuts would disproportionately benefit wealthier sectors, emphasizing that fuel prices affect the entire economy.
“Fishermen, farmers, drivers, they all depend on the price of crude oil to make a living. When prices are high, they are the first to be hit, no one goes out to sea, and no one brings their produce to the market,” she pointed out.
Legarda warned that prolonged high fuel costs could lead to job losses, declining incomes, business closures, and increased poverty among vulnerable sectors.
“There will come a point when theoretical discussions are no longer enough. We need to respond to what Filipinos are actually experiencing today,” she said.
She also downplayed concerns about funding, noting that temporary tax relief would not require additional borrowing.
Legarda cited provisions in her proposed Bayanihan 3 bill, which include measures to cut non-essential government spending, such as travel, events, and renovations, while reallocating savings from projects lacking feasibility studies or clear implementation plans.
Additional fiscal space, she added, could be generated by shifting more government transactions online to reduce operational costs and imposing a temporary freeze on hiring and the creation of new offices, except for critical positions in health and education.