THE House of Representatives is targeting a May 4 vote on a proposal to remove the value-added tax (VAT) on petroleum products, as lawmakers push broader relief from rising fuel costs despite opposition from the government’s economic team.
“The members of Congress are ready to vote to lower the VAT,” Batangas Rep. Leandro Antonio L. Leviste said during a Legislative Energy Action and Development Council hearing on Wednesday, adding that the chamber has sufficient support to move forward with the measure.
Mr. Leviste said lawmakers are prepared to bypass resistance from the economic team and proceed with legislation that would suspend the 12% VAT on petroleum products.
“Our countrymen can expect Congress to open again on May 4 when we will vote to remove the value-added tax,” he said.
The proposal, covered under House Bills 4302 and 8838, seeks to ease the burden of elevated fuel prices on households, transport workers and other sectors.
Lawmakers backing the measure said removing VAT would provide immediate and visible relief compared with targeted subsidies.
The push comes amid mounting frustration among legislators, who accused the Executive branch and its economic managers of delaying action on fuel costs.
Mr. Leviste said continued inaction could erode public trust, adding that Congress must respond to the needs of Filipinos even amid differing views within the Cabinet.
However, some lawmakers urged caution, citing the need for a clearer policy basis before proceeding to a vote.
“There cannot be a vote now… We will wait for the consolidation of all of this,” Marikina Rep. Romero Federico “Miro” S. Quimbo told the hearing in Filipino, referring to discussions among committees.
“We will listen to the different sectors so that our decision will be right and we will not regret it,” he added, stressing that any measure should consider long-term implications rather than short-term relief.
Mr. Quimbo said deliberations would continue once Congress reconvenes, with the joint committee working to finalize a consolidated position.
The proposal has drawn opposition from the economic team and Executive Secretary Ralph G. Recto, who has cautioned against suspending VAT due to its impact on government revenues.
The Executive branch has instead backed targeted interventions. President Ferdinand R. Marcos, Jr. on Monday said he approved the suspension of excise taxes on liquefied petroleum gas and kerosene while keeping levies on gasoline and diesel unchanged.
Economic managers through the Development Budget Coordination Committee (DBCC), said across-the-board tax cuts such as VAT removal tend to benefit higher-income households that consume more fuel, while offering less targeted support to vulnerable groups.
Finance Undersecretary Karlo Fermin S. Adriano has said the DBCC has not recommended suspending VAT on diesel and gasoline, citing significant fiscal risks.
He said a full suspension could result in revenue losses exceeding P120 billion over eight months, adding to existing budget pressures.
Mr. Adriano also noted that VAT differs structurally from excise taxes, making it more complex to suspend.
He said the effective VAT rate on fuel is closer to 5% due to input-output mechanisms, and removing it could lead companies to pass on unrecoverable input VAT costs to consumers, potentially muting the expected price reductions.
Amid these concerns, the House committee has required the DBCC, Department of Finance and the Department of Budget and Management to submit detailed data supporting their positions.
Lawmakers said the requested documents would help clarify the fiscal impact of proposed tax measures, including foregone revenues and underlying assumptions, as Congress weighs its next steps on fuel tax policy. — Erika Mae P. Sinaking
