President Ferdinand Marcos Jr. on Monday ordered the removal of excise taxes on liquefied petroleum gas (LPG) and kerosene, a move aimed at easing household expenses while maintaining support for domestic producers.
Marcos’ decision also aims to temper the loss of excise tax revenue that are needed to support various subsidies needed to navigate the energy emergency caused by the conflict in the Middle East.
Speaking at Malacañang, Marcos said the policy could lower LPG prices by around P3.30 to P3.36 per kilogram—equivalent to roughly P37 per standard tank—while kerosene prices may fall by as much as P5.65 per liter. The reductions are expected to deliver immediate relief to households that rely on these fuels for cooking and lighting, particularly lower-income consumers.
The tax cut forms part of a broader package designed to temper inflationary pressures on essential goods. Alongside the measure, the government is accelerating import clearances, scrapping select port and fishport fees, and reducing logistics costs such as cargo handling and storage. These steps aim to address supply bottlenecks that have contributed to elevated food prices in recent months.
Marcos emphasized the need to balance consumer protection with industry viability, describing the economy as a “complicated” system requiring calibrated interventions.
He reiterated that safeguards for local producers remain in place even as the government moves to cushion consumers from price shocks.
Further, the administration plans to expand subsidized rice distribution and deploy public funds to narrow the gap between farmgate and retail prices—an approach that signals a more active fiscal role in price stabilization.
However, the President defended the decision to retain value-added tax (VAT) on petroleum products, arguing that revenues are necessary to finance social support programs.
The policy mix suggests a targeted approach: selective tax relief on critical household fuels, offset by sustained revenue streams to underwrite subsidies and market interventions.
