Manila: The government must carefully weigh the fiscal impact of suspending fuel excise taxes as it could significantly reduce revenues needed to fund public programs, Sen. Sherwin Gatchalian said on Monday. Gatchalian, who chairs the Senate Committee on Finance, noted the potential revenue loss of around PHP16 billion to PHP18 billion from such a suspension.

According to Philippines News Agency, Gatchalian emphasized that suspending excise taxes on petroleum products remains a 'last resort.' He pointed out that the loss of revenue could impact the government's ability to fund public assistance programs. 'There will be a big loss, around PHP16 to PHP18 billion. We understand that. And if we lose collections, we will also have no source for the assistance we provide,' Gatchalian stated.

The senator acknowledged the argument for suspending excise taxes, particularly on diesel used by the transport and logistics sectors. However, he stressed the need to balance consumer relief with sustaining public spending. Gatchalian expressed support for targeted fuel subsidies, which he described as a more direct way to assist sectors most affected by high oil prices, such as public utility drivers and farmers. 'I favor the targeted approach because it goes directly to those who truly need it,' he said.

Gatchalian noted that global oil prices have begun to ease, allowing the government to consider a calibrated response while monitoring market trends. He suggested alternative measures like fuel discount programs and service contracting to provide quicker relief to transport operators without resorting to a full tax suspension.

Despite these options, Gatchalian maintained that suspending excise taxes on diesel remains under consideration due to its widespread use in public transport and goods delivery.