4.3B liters of fuel marked but small firms say playing field not even

The volume of marked tax-paid oil products has exceeded the 4 billion liter mark, but small oil players on Tuesday (March 3)  said the government may be focusing on the small fish while big firms were not ready to take part in the fuel marking program.

At an economic forum on Tuesday, Finance Undersecretary Antonette C. Tionko said the Bureau of Customs (BOC) reported last Monday (March 2) that 4.3 billion liters of fuel had already been injected with a chemical signifying correct payment of duties and excise.

But Fernando Martinez, Independent Philippine Petroleum Companies Association (IPPCA) chair, said there seemed to be lack of an even playing field as the fuel marking program was not “uniformly implemented.”

Martinez said IPPCA members were already complying with fuel marking but “I’m not sure if refineries are ready,” referring to big companies’ facilities.

In response, Tionko said: “We’re trying our best to do it as rapidly as possible. But, obviously, since this is the first time for a nationwide implementation, it’s not as easy as we think it would be because it’s quite complicated.”

“As you are aware, not all petroleum companies are similarly situated,” Tionko said.

“So to the extent that we can, we are doing it as quickly and as uniformly as possible,” she added.

She said if the issue being raised by the small players was about testing, “obviously we’re trying to be fair with the testing.”

“Maybe, at the start we won’t be as strict in enforcing or penalizing companies because, obviously, we know that it’s not yet perfectly implemented,” Tionko added.

For 2020, the government had projected an additional P20 billion in collection as a result of the fuel marking program.

The Department of Finance (DOF) earlier estimated that the volume of fuel to be marked will total 15.2 billion liters—6.8 billion liters for the Bureau of Customs (BOC) and 8.4 billion liters for the Bureau of Internal Revenue (BIR).

Under the joint fuel marking guidelines issued in 2019, the BOC is in charge of fuel marking in depots, tank trucks, vessels, warehouses, and other fuel-transporting vehicles, while the BIR conducts testing in refineries, their attached depots, gasoline stations, and other retail outlets.

Both the BOC and the BIR had been deputized and given police authority during field tests and have the power to seize adulterated, diluted or unmarked petroleum and arrest violators.

Fuel marking costs P0.06884 per liter—shouldered by the government in the first year of implementation.

The joint venture of SGS Philippines Inc. and Switzerland-based SICPA SA was the marker provider through a five-year contract, under which they produce and provide the ready-to-use official marker, as well as conduct actual marking of all taxable oil products across the country.

Edited by TSB