Customs Commissioner Alberto D. Lina sees a raise in the excise tax slapped on petroleum products as one solution to reverse the slower growth in collections caused by cheaper oil.
In a telephone interview on Monday, Lina noted that while the Bureau of Customs (BOC) had been “doing all right” in terms of collecting import duties and taxes, the drop in global oil prices had been denting revenues.
“We have to collect P1.5-2 billion a day. It would be challenging if collections from oil products decrease drastically,” Lina said.
Taxes and duties from oil products contribute over a fifth of the BOC’s annual collections.
The country imports and consumes an average of 120 million barrels of oil a year.
Last week, former BOC chief John Phillip P. Sevilla reported that the BOC’s collections during the first quarter grew 6.6 percent year-on-year to P92.2 billion, at a slower growth rate compared with the double-digit rise posted last year.
The collection in the first quarter was also short of the P103.3-billion goal for the first three months.
Even as collections from non-oil products jumped by almost a fourth to P77.2 billion during the three-month period, revenues from oil imports slid by 38.1 percent to P14.9 billion despite import volumes of the commodity having increased by almost a fifth. Global oil prices dropped by about 53 percent year-on-year during the first quarter.
Sevilla had said that the BOC’s “realistic” collection target should only be P373 billion, much lower than the adjusted goal of P436.5 billion set by the interagency, Cabinet-level Development Budget Coordination Committee early this month.
The original 2015 target for the BOC was P456.4 billion, which was cut to reflect about P20 billion in foregone revenues expected from cheaper oil.
For Lina, a viable “intervention” to arrest the slower growth of the BOC’s collections to date is to jack up the excise tax on petroleum products, which have stayed low since the 1990s.
Lina noted that excise taxes can be increased by legislation as well as by the President.
Disclaimer: The comments uploaded on this site do not necessarily represent or reflect the views of management and owner of Cebudailynews. We reserve the right to exclude comments that we deem to be inconsistent with our editorial standards.