Senator Legarda files bill to suspend or reduce VAT on fuel products

Senator Loren Legarda filed Senate Bill No. 2043 on April 15, 2026, seeking to suspend temporarily or reduce the Value Added Tax (VAT) on fuel.

She noted that her earlier proposal, Senate Bill No. 1942—which covered both excise tax and VAT—was considered in the passage of Republic Act No. 12316, though the final law addressed only excise tax.

The Senator called on Malacañang to state its position on this matter, particularly in response to claims that such a measure would require legislative action.

The senator emphasized that the executive branch should not pass the responsibility back to Congress.

It was noted that during previous deliberations, proposals on VAT were considered; however, excise tax was ultimately prioritized based on the administration’s specific recommendation.

“Hindi pwedeng sabihin ng Malacañang na walang batas. Nag-file na ako noon at nag-refile pa ako ulit ngayon, para wala nang dahilan. Ang tanong ngayon: susuportahan nyo ba? I-cecertify nyo ba na urgent? Kung hindi, malinaw na hindi ito prayoridad at ang gusto ng gobyerno ay tuloy-tuloy na buwisan ang krisis," Legarda said.

“Huwag ninyo ipasa sa Kongreso ang problema. Noong deliberasyon, malinaw na may mga panukala na sa VAT, pero ang itinulak ninyo ay excise dahil una, mas madali daw ito iimplement at pangalawa, agad din daw itong ipapatupad. Nirespeto namin ang hiling ng Ehekutibo dahil sila ang nakakakita ng datos. Eh hanggang ngayon puro pa din usap, kumbaga sa libro, death-by-meeting, tapos ngayon sasabihin ninyo na walang batas? This administration has an “urgency” and crisis communication problem.”

During the second PROTECT Senate hearing, oil industry representatives affirmed that suspending VAT is both feasible and implementable.

Legarda warned that maintaining VAT amid rising fuel prices effectively increases government revenue as costs climb. She stressed that relief should be provided immediately through price reductions rather than being delayed through subsidy mechanisms.

“Kung ibababa mo ang buwis, diretso ang epekto sa presyo. Kung ayuda, dadaan pa sa buong proseso, verification, distribution, matagal. Hindi dapat pinapadaan sa mabagal na sistema ang agarang tulong na puwedeng direkta sa presyo ng petrolyo.”

She argued that these "windfall" revenues are derived from the higher costs already borne by consumers, effectively forcing the public to shoulder the financial burden upfront.

According to Legarda, this approach results in citizens receiving only partial assistance later, often following significant delays.

"Hindi ito usapin kung may pondo o wala. May windfall gains na nga, at sinabi na rin ng pamahalaan na may humigit-kumulang ₱230 bilyong fiscal space. Kung kinakailangan, maaari ring magdeklara ng savings ang mga ahensya mula sa mga proyektong hindi na maipapatupad ngayong taon o yung hindi naman emergency, gaya ng travel, capacity-building activities, events, at iba pang gastusing puwedeng ipagpaliban sa pamamagitan ng mas matalinong paggastos," she said.

"May kakayahan ang gobyerno na rumesponde sa krisis. Ang tunay na tanong: gagamitin ba ito para agad mabawasan ang pasanin ng mamamayan, o patuloy bang bubuwisan ang krisis bago ibalik bilang ayuda? Para sa akin, hindi dapat binubuwisan ang hirap ng tao,” she added.

Legarda has emphasized that the current issue centers on policy direction: whether to immediately reduce fuel costs at the source or to continue collecting taxes during a crisis at the public’s expense.

-Paraluman News