OIL SMUGGLING in the country may have been costing the government as much as P60 billion in taxes yearly, or double the industry?s earlier estimates of P30 billion to P35 billion, according to Energy Secretary Jose Rene D. Almendras.

?(One of the) most pressing problems of the upstream and downstream (industries) is oil smuggling. We have been reminded by oil sector players that they were expecting the government to step up initiatives against and address the oil smuggling problem in the country,? Amendras admitted.

According to Almendras, the Department of Energy is investigating the extent of oil smuggling in the country as reports cited a wide range of P20 billion to P60 billion in tax revenue losses every year.

?As of last Friday, the Department of Finance has called for an interagency meeting with the DOE and the Department of Justice on a plan to form an interagency team that will specifically address oil smuggling,? Almendras said.

?We hope to activate this interagency task force within the month so we can start as soon as possible,? he added.

The energy chief stressed that oil smuggling was one of the main reasons why pump prices of petroleum products were higher by as much as P5 a liter in certain areas.

?Smuggling has significant impact on pump prices. The biggest challenge to the government is the tariff and VAT (value added tax) revenue losses arising from oil smuggling,? Almendras explained.

To help curb the rampant fuel smuggling, the DOE earlier said it planned to maximize the use of marker dyes and determine the source of imported petroleum products.

?For instance, once an adulterated (fuel) product is found, we will also find out the source of the fuel. And since the marker dye system can be used to determined the source, it can also be used by the energy department for its anti-smuggling drive,? said Zenaida Y. Monsada, director of the DOE?s Oil Industry Management Bureau.

The marker dye system is currently used to determine whether certain types of imported fuel have been cleared for entry to the Philippines. Further tests will determine the source.

Monsada said that by knowing the source, the government would be able to impose more stringent controls and keep a tighter watch over the fuel imports. This, therefore, help in ensuring that petroleum products are imported legitimately.

Citing a study, San Miguel Corp. president Ramon S. Ang earlier said that as much as 35 percent of the gasoline and diesel sold in the market was smuggled into the country. This was equivalent to some P30-P35 billion in uncollected taxes, he added.