The year 2020 is just around the corner, new year, new you. But it looks like we might have to shell out a few more Pesos in fueling up our vehicles soon. Why? The third (and final) tranche of excise tax rates under the TRAIN law will soon be taking effect on all petroleum products.
Effective January 1, 2020, the new tax rates for petroleum products will be implemented. With it, a Php 1.00 to 1.50 tax hike will go into effect across all petroleum-based products.
Unleaded gasoline, which is currently taxed at Php 9.00 per liter/kg, will be levied at Php 10.00 starting next year. As for diesel fuel oil, it will go up from Php 4.50 to Php 6.00 while kerosene will hike from Php 4.00 to Php 5.00. Users of liquefied petroleum gas (LPG) might also have to bear a slight price increase as its new tax rate will go from Php 2.00 to Php 3.00.
From the current Php 9.00 per liter/kg levied on lubricating oils and greases, processed gas and waxes/petrolatum, it will go up to Php 10.00 in 2020.
A provision under the law (RA 10963) does provide protection, should average crude oil price based on Mean of Platts Singapore (MOPS) reach or exceed $80 per barrel, the scheduled increase in the excise tax on fuel shall be suspended for three months prior to the increase of the month. With the average price of crude oil at around $61 per barrel, the third and final tranche of the excise tax on fuel will definitely go into effect.
Also note that increases on pump retail prices should not directly take effect on January 1, 2020; as the new levies will only affect supply imported starting 2020.