MANILA, Philippines – Senator Antonio “Sonny” Trillanes IV is seeking the imposition of up to 80 percent windfall profit tax on oil companies to “moderate their greed.”
Senator Antonio “Sonny” Trillanes IV. INQUIRER FILE PHOTO
Trillanes filed Senate Bill 2959 proposing a 12 percent cap on the annual profits of oil companies. Those that will exceed the 12 percent ceiling but have less than 20 percent of their paid-up capital per year will be slapped with another 50 percent tax.
An additional 80 percent windfall tax,on the other hand, will be imposed on oil firms with profits exceeding 20 percent of their paid-up capital per year, according to the bill.
“I believe that this measure would effectively discourage oil firms from further engaging in profiteering,” he said in a statement on Thursday.
“Hopefully, it would provide our people with much needed relief from the endless rounds of oil price increases which we have seen in recent weeks,” he said.
Trillanes pointed out that his proposed legislation was not meant to raise revenue for the government but to exercise the police power of the state “in order to regulate the profits of companies in the petroleum industry, which is clearly imbued with public interest.”
“The problem is that, under the current deregulated system, government is virtually helpless in checking the apparent abuses by petroleum industry players in increasing or refusing to decrease the prices of petroleum products even when warranted by market forces,” he said.
“The situation is aggravated by the lack of transparency in the formula being used by petroleum companies in order to arrive at their prices and the apparent incompetence or indifference of the officials of the Department of Energy (DoE) in addressing the situation,” he said.
“The consuming public is virtually at the mercy of the oil industry cartel, which has gleefully taken advantage of the situation at the expense of entire populace,” the senator added.
The incidental benefit of the bill, Trillanes said, was that the windfall tax would also allow the redistribution of the excess profits of oil companies to the public by way of increased funding for public services.