Fuel marking to raise gov’t 2020 tax take by P10B

The Bureau of Customs (BOC) expects the full implementation of the fuel marking program this year to generate P10 billion in additional revenue help the agency meet its higher collection target for 2020, Customs Commissioner Rey Leonardo Guerrero said.

Guerrero told the Inquirer on Thursday that fuel marking would boost the BOC’s tax-collection drive, as the country’s second-biggest revenue agency had been tasked to collect “over P700 billion” this year.

The Cabinet-level Development Budget Coordination Committee had set the BOC’s 2020 collection goal at P731 billion.

As of November last year, the BOC had already marked about 435 million liters of fuel across various facilities of oil companies nationwide.By Feb. 3 this year, all retailed diesel, gasoline and kerosene are expected to be injected with a chemical marker that serves as proof that the product has paid the proper customs duties (if imported) and other taxes (if refined locally).

Fuel marking costs P0.06884 a liter and is ‍shouldered by the government on the first year of implementation, after which the payments will come from the trust receipt created under the Tax Reform ‍ for Acceleration and Inclusion Act.

The fuel marking provider—the joint venture of SGS Philippines Inc. and Switzerland-based SICPA SA under ‍‍ a five-year contract—was not only producing and providing the ready-to-use official marker, but also conducting actual fuel marking nationwide in all taxable oil products.

The joint fuel marking guidelines issued by the BOC, the Bureau of Internal Revenue (BIR) and the Department of Finance (DOF) last year empowered the BOC and the BIR with deputization and police authority during field testing—such that when they find adulterated, diluted or unmarked petroleum, BOC and BIR officers can seize these products, and arrest unscrupulous traders.

The fuel marking program was expected to minimize smuggling and misdeclaration in order to jack up the collections of both the BOC and the BIR, the country’s two largest tax-collection agencies.

Meanwhile, Guerrero said the BOC already had initial data on its full-year 2019 collections, but he declined to provide the figure as it was still up for DOF validation.

As of end-November last year, the BOC’s tax take rose 7.4 percent year-on-year to P578.1 billion.

The BOC was programmed to collect P661 billion in revenue last year.