A new Philippine Senate bill seeks to provide immediate relief to consumers by automatically suspending the 12% value-added tax and excise taxes on fuel whenever global oil prices hit USD 80 per barrel or higher, aiming to shield families and businesses from inflation spikes driven by geopolitical instability in oil-producing regions.
The Philippine Senate is considering Senate Bill No. 1935, which was first read on 9 March 2026, proposing an automatic suspension of fuel taxes when global oil prices surge beyond a specific threshold.
The bill establishes a clear trigger for tax relief: when Dubai crude oil prices reach or exceed USD 80 per barrel based on the Mean of Platts Singapore (MOPS), both the 12% value-added tax (VAT) and excise taxes on fuel will be automatically suspended. This suspension will remain in effect until prices normalise below the threshold.
The explanatory note highlights that fuel price volatility significantly impacts the Philippines, a net oil-importing nation. Recent armed conflicts in the Gulf Region have created supply uncertainties and upward pressure on crude prices.
Currently, no automatic mechanism exists to cushion consumers during price surges, forcing Filipinos to bear the full burden of both elevated fuel costs and the layered taxes imposed on top.
The bill amends three sections of the National Internal Revenue Code of 1997: Section 106 (VAT on sale of goods), Section 107 (VAT on importation), and Section 148 (excise taxes on manufactured oils and fuels).
Under the proposed amendments, the Secretary of Finance must issue implementing regulations within thirty (30) days of the law’s effectivity.
If passed, the Act will take effect 15 days after publication in the Official Gazette or in at least two newspapers of general circulation.
