DOF warns: Fuel price hike on Jan. 1 can be considered ‘profiteering’
Fuel price increases as a result of the first tax reform package that took effect Monday would not be immediate such that the Department of Finance (DOF) warned oil firms that will take advantage of the new excise tax scheme.
“The increase is not expected to take effect immediately on Jan. 1 as it takes a few days for the 2017 oil stock to be used up. This is because the excise is paid at the port of importation or refinery,” the DOF explained in an advisory.
As such, “oil (price) increase done by companies on Jan. 1 might be considered profiteering,” the DOF added.
President Rodrigo Duterte last Dec. 19 signed into law package 1A of the Tax Reform for Acceleration and Inclusion Act (Train) under Republic Act (RA) No. 10963, which starting Jan. 1 this year will slash and restructure personal income tax rates that stayed the same for two decades, while also jacking up or slapping new taxes on consumption of oil, cigarettes, sugary drinks and vehicles.
Internal Revenue Commissioner Caesar R. Dulay told the Inquirer that five teams at the BIR were working on the revenue regulations that will serve as the implementing guidelines of the Train
The Bureau of Internal Revenue is fast-tracking the issuance of the implementing rules and regulations of the various measures under the first tax reform package, including the lower personal income tax rates effective Jan. 1, 2018.
“In anticipation of the law’s implementation at the start of , the BIR is set to issue various revenue regulations on income Tax, withholding tax, value-added tax (VAT), excise tax on petroleum, excise tax on automobiles, excise tax on mineral products, excise tax on tobacco, excise tax on sweetened beverage, cosmetic procedures, estate and donor’s tax, percentage tax, and documentary stamp tax,” the country’s biggest tax-collection agency said in statement late Friday.
“The issuances [to be issued in early 2018] also include a revenue memorandum order on the VAT refund system. The BIR will also put into place systems on eSales and eReporting,” the BIR added.
“Public consultations will be held on Jan. 11 and 12 to help guide the drafters in coming up with the various issuances on the Train Act, as well as internal briefings which will be conducted on Jan. 24-26,” according to the BIR.
Last Dec. 28, Dulay issued Revenue Memorandum Circular No. 105-2017, which revised the withholding tax table on compensation in the Tax Code to reflect the changes under the Train.
“With the forthcoming effectivity of RA 10963 on Jan. 1, 2018, it is imperative that a smooth transition as to withholding tax rates is ensured. Thus, for the information and guidance of all concerned, beginning Jan. 1, 2018, every employer making compensation payments to their respective employees shall deduct and withhold from such compensation a tax determined in accordance with the revised withholding tax table,” Dulay said. /jpv
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