MANILA — President Ferdinand “Bongbong” Marcos Jr. has signed into law a measure granting Malacañang sweeping authority to suspend or reduce fuel excise taxes as global oil prices surge, arming the government with a key tool to blunt inflation and stabilize domestic pump prices.
Republic Act 12316, signed Wednesday, takes effect immediately upon publication and consolidates Senate Bill No. 1823 and House Bill No. 8220.
The new law amends Section 148 of the National Internal Revenue Code of 1997, allowing the President — upon recommendation of the Department of Energy (DOE) and the Development Budget Coordination Committee (DBCC) — to adjust excise taxes on petroleum products when the average Dubai crude price, based on the Mean of Platts Singapore (MOPS), reaches at least $80 per barrel over a one-month period prior to the issuance of an order.
Under the measure, the President may either fully suspend or partially reduce excise taxes on selected petroleum products, although such authority is limited until Dec. 31, 2028.
Oil firms are mandated to submit monthly reports on the cost components of petroleum products to the DOE, which will transmit the data to Congress and the DBCC. The Bureau of Internal Revenue and the Bureau of Customs are likewise required to provide monthly updates on value-added tax computations.
The law also compels the President to report to both houses of Congress, detailing the factual basis and policy objectives of any tax adjustment, including estimates of foregone revenues, expected social benefits, and projected impacts on inflation, fuel prices, and the broader economy.
Earlier, Marcos said the executive will have to study “when is the best time to use that new authority,” noting that conditions set by the law must first be met.
The enactment comes amid rising global oil prices linked to tensions in the Middle East and follows the President’s declaration of a national energy emergency aimed at accelerating government response to supply and pricing risks.
Officials said the measure is expected to provide flexibility in managing fuel costs and cushioning the impact of inflation on consumers and businesses./PN
