MANILA — In a stern warning to the government and the public, Senate President Pro Tempore Panfilo “Ping” Lacson cautioned that temporary tax relief at the pump could lead to a long-term economic headache for the country.
As the Philippines grapples with skyrocketing fuel prices driven by the ongoing conflict in the Middle East, Lacson revealed that a total suspension of excise taxes and Value-Added Tax (VAT) on petroleum products could drain the national treasury of over P320 billion.
In a radio interview on Sunday, the veteran lawmaker emphasized that while cutting taxes might be a popular move to “win brownie points” with voters, the resulting “foregone revenues” would deal a severe blow to the country’s Gross Domestic Product (GDP).
“It’s not that simple, because we only look at suspending and suspending [taxes] to please our countrymen,” Lacson said. “But its impact on GDP is severe. In the long or even medium term, we will be the ones affected.”
According to Lacson’s estimates, the suspension of excise taxes alone would result in roughly P200 billion in lost revenue through 2027. If the government follows through with suggestions to also suspend VAT on fuel, that loss would nearly double.
While he acknowledged the heavy burden on Filipinos—with regular diesel potentially hitting P165 per liter—Lacson argued that any tax reduction must be surgical rather than broad. He suggested that suspending the excise tax alone should be sufficient to provide “breathing room” without completely crippling the national budget.
Beyond the tax debate, Lacson also turned his attention to those taking advantage of the crisis. He called for transparency regarding the penalties imposed on gas stations caught overcharging.
“The public deserves feedback on what happened to the offenders who were caught in plain sight raising fuel prices without authorization,” he noted. Recent reports from the Philippine National Police (PNP) indicate that while hundreds of stations remain closed due to supply shortages, several cases have already been filed against dealers for profiteering violations.
As the President’s economic team prepares to meet, the nation remains caught in a delicate balancing act: providing immediate relief to struggling families while ensuring the country’s economic foundation doesn’t crumble under the weight of lost revenue.