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Fuel marking’s full enforcement: P20B in added revenue, stop to smuggling

By: - Reporter / @bendeveraINQ
/ 03:55 PM September 26, 2019

No more revenue loss from smuggling. At least P20 billion in additional revenue.

These were the benefits seen when the Department of Finance (DOF) fully enforces the government’s fuel marking program, which would help ferret out smuggled fuel by injecting molecular markers into petroleum products.

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At a Senate finance committee hearing on the DOF budget for 2020 last Wednesday (Sept. 25), Finance Undersecretary Antonette C. Tionko said tests for fuel marking had been finished.

The government and private sector, however, were still in the process of automating the system.

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Fuel marking is currently being done manually, Tionko said.

“The team is in the process of working with the big refineries for installation of the automatic injection of the marker,” she said.

She added that automation was needed because of the huge volume of fuel that needs to be marked.

By October, she said, the DOF planned to test marked products to ensure the system was foolproof.

The government had projected to collect a “conservative” P20 billion in additional revenues through the fuel marking program next year, which Tionko said was just half of the estimated amount being lost to oil smuggling yearly.

The government started fuel marking last July.

Mandated by the Tax Reform for Acceleration and Inclusion (Train) Act, fuel marking will cost just a fraction of a peso that would be shouldered by the government in the first year of the system’s enforcement.

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Payments for fuel marking would be taken from revenue generated by Train law in succeeding years.

The service provider for the program, a joint venture of SGS Phils. Inc. and Switzerland-based SICPA SA under a five-year contract, was required to produce a marker approved by the government, provide it in ready-to-use form and conduct actual marking nationwide on all oil products except for some jet fuel, aviation gas, crude oil and liquefied petroleum gas.

Guidelines of the fuel marking program deputized the Bureau of Customs an Bureau of Internal Revenue as enforcers with police authority during field tests of the program.

If diluted or unmarked petroleum was found, Customs or BIR officers have the power to conduct arrests and seize products.

The BIR will supervise field tests in refineries, depots, gas stations and other retail outlets. The BOC would oversee fuel marking in depots, tankers, vessels, warehouses and other fuel-transporting vehicles./tsb

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TAGS: BIR, customs, depots, DoF, fuel, loss, Petroleum, refineries, revenue, Smuggling, tankers
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