Malacañan Palace issued Executive Order No. 114 on April 16, suspending excise taxes on liquefied petroleum gas and kerosene for three months, citing a sharp rise in global crude oil prices that triggered the legal threshold for executive intervention.
The order covers LPG except when used as raw material for petrochemical production or for motive power, and kerosene except when used as aviation fuel.
The legal basis traces to Section 1 of Republic Act No. 12316, which amended the National Internal Revenue Code of 1997 and authorizes the President to suspend or reduce excise taxes on petroleum products once the average Dubai crude oil price based on the Mean of Platts Singapore reaches or surpasses USD80 per barrel over a one-month period.
That threshold was formally confirmed on April 10, when the Department of Energy certified that the 30-day average Dubai crude price had climbed to USD93.71 per barrel.
The suspension follows a recommendation from the Development Budget Coordination Committee through Resolution No. 2026-3. The DBCC called for full suspension of the covered taxes, with the measure subject to monthly review during its three-month duration.
Under Section 3 of the order, excise tax rates will automatically revert to levels prescribed under Section 148 of the NIRC without need for a separate issuance, either one week after the one-month MOPS average drops below USD80 as certified by the DOE, or upon expiration of the suspension period — whichever occurs first.
The DOE and the Department of Finance, through the Bureau of Internal Revenue and the Bureau of Customs, are directed to conduct an inventory of existing LPG and kerosene stocks as of the order’s effectivity. The BIR and BOC are also required to submit monthly reports to Congress on the declared value and volume of petroleum products covered.
Oil companies are further directed to submit monthly cost component data on covered petroleum products to the DOE, which must relay that information to the DBCC and Congress under RA No. 12316.
The order was signed by Acting Executive Secretary Ralph G. Recto and takes effect upon publication in the Official Gazette or a newspaper of general circulation.
