Households that cook with liquefied petroleum gas (LPG) and kerosene are getting tax relief for the second time this year, after the global crude benchmark used by the Philippine government crossed the level that allows fuel levies to be set aside.
The Department of Energy certified that the average price of Dubai crude, based on the Mean of Platts Singapore over the previous 30 calendar days, had climbed to $99.41 per barrel, Manila Bulletin reported. That certification led to Executive Order No. 125, which President Ferdinand Marcos Jr. signed on September 25, 2026.
The order removes the full tax on both products but keeps two exemptions in place. LPG stays taxable when it is used to make petrochemicals or to fuel vehicles, and kerosene remains covered when sold as aviation fuel.
“The excise taxes on LPG, except when used as raw material for production of petrochemical products or used for motive power, and kerosene, except when used as aviation fuel, are hereby fully suspended,” the order states.
Finance Secretary Frederick Go signed the Development Budget Coordination Committee (DBCC) resolution seeking the suspension during the Department of Finance’s Senate budget hearing on September 22. He defended the choice of the two fuels by pointing to who uses them, saying “these are the fuel products used by the most vulnerable households.” According to the Philippine Daily Inquirer, Go said the tax break could run until the end of the year.
The measure rests on Republic Act No. 12316, which Marcos signed on March 25, granting him emergency power to suspend or cut the excise tax rate on fuel. The law allows him to act, in coordination with the energy secretary, once the average Dubai crude price reaches or exceeds $80 per barrel for a month, with each suspension lasting up to three months and all suspensions capped at one year.
This is not the first time the two products have been freed from the levy in 2026. Executive Order No. 114, signed on April 16, carried the earlier suspension, which Marcos said would cut P3.36 per kilo of LPG, nearly P37 per tank, and P5.65 per liter of kerosene. That relief ended in July after the Department of Energy certified that the one-month Dubai crude average had dropped below the threshold, Philstar.com reported.
Under the new order, the DBCC must review the suspension within 15 days and monthly thereafter, report to the House and Senate, and may recommend that the President continue, modify, extend, or end it. Oil companies will also have to submit monthly data on the cost components of the covered products to the Department of Energy for the duration of the suspension, and the Department of Finance, through the Bureau of Internal Revenue and the Bureau of Customs, may issue implementing rules together with the energy department.
Diesel and gasoline were left out. Go said the DBCC is not inclined to endorse suspending taxes on those fuels, calling such a move “not progressive” and warning of an estimated P12 billion in lost revenue each month, with the government instead providing targeted subsidies to vulnerable sectors.
