The Department of Energy (DOE) has cleared various gas stations that allegedly took advantage of the tax-reform law by selling old inventories at much higher prices.
“Based on the documents that they submitted to us, ending January 31, it seems that they implemented their price increases because they were already using new stocks, meaning their old stocks had run out,” DOE Assistant Secretary Leonido Pulido III said.
Still, the agency’s initial assessment would have to be verified. “Since the documents came from [oil firms], who will validate these? We based it on historical records, usually that’s not enough. But we wrote [to the] BIR [Bureau of Internal Revenue], which agreed to look into the documents’ authenticity,” Pulido said.
Earlier, the agency said there are more than 20 various gas stations that took advantage of the tax-reform measure.
A random inspection on all 6,800 gasoline stations were conducted to verify whether the excise tax under the Tax Reform for Acceleration and Inclusion (TRAIN) Act was properly imposed.
With the additional excise tax, unleaded gasoline increased by about P2.97 per liter, while the price of diesel surged by P2.80 per liter.
The implementation of excise tax and value-added tax for petroleum products under the TRAIN does not apply to the old stocks of petroleum products, including their stocks under the 15-day minimum inventory requirement.
Consequently, the retailers should not charge the new excise tax to the consumers.
The DOE told the oil companies to submit a daily summary of stock withdrawals starting on January 1 until the depletion of the declared inventory as of end-2017.
The Senate Committee on Energy had said it wants to put in place mechanisms to monitor the levels of supply of petroleum products, including the imposition of stricter penalties for late and incorrect inventory submissions of oil companies, as well as for the negligence on the part of government agencies to monitor price movements.
“I can foresee that we need to penalize oil companies if they don’t submit their inventories on time or if they give incomplete or inaccurate information about their stock levels. With or without the additional excise taxes from the TRAIN Law, these companies are still duty-bound to submit their monthly inventories. And the DOE should be on top in ensuring their compliance,” Sen. Sherwin T. Gatchalian said.
Under Section 14 of the oil deregulation law (RA 8479), the DOE is mandated to maintain a periodic schedule of present and future total inventory of petroleum products in the country. Because of this, oil companies are required to submit a monthly report that details their sales and consumption levels, actual and projected importations and inventory of oil products.
“So, even if oil companies and gas stations already raise prices using their new supply in accordance to [the] TRAIN, they would still have to be audited by the DOE and determine whether they unduly increased their prices without any clear basis, in which case they will have to face the appropriate penalties and fines,” Gatchalian added.
