The House Committee on Transportation chair and member of the Justice Committee, Representative Franz Pumaren said the removal of excise tax and value-added tax (VAT) on fuel products indicates a “big factor” that must be considered. 

“Of course, removing the excise tax [and VAT] is a big factor,” he said, speaking at the Saturday News Forum. 

Pumaren stated that the discussion on removing VAT was even raised in a previous House committee hearing, which, according to him, reflects how the law works—when fuel prices increase, VAT and excise tax collections also rise. 

“That’s why during the hearing, I raised the point with the DOE [Department of Energy] that when the price of gasoline increases, the VAT we charge also increases—12% automatically—the same thing with excise tax,” the lawmaker said. 

In response to calls to remove VAT and excise tax on fuel purchases, Pumaren raised questions about the 2026 national budget, particularly how much has already been allocated under the General Appropriations Act (GAA) and how much revenue is projected to be collected. 

The congressman said that even as gasoline and diesel prices rise, the taxes paid by consumers also increase. 

“VAT is automatically 12%, and the excise tax is set at 6 pesos,” he pointed out.

On the possibility of a windfall, Pumaren noted that it may be worth considering suspending or reducing VAT and excise taxes once the government reaches its target revenue or budget peak.

The lawmaker, however, emphasized that rising fuel prices also trigger increases in the cost of basic goods and commodities, which must be carefully balanced.

“Maybe our taxes—our [tax] collections—have increased, but we have to consider that there is not much movement at the lower level, the purchasing power of the people,” Pumaren said. 

He added that the government must ensure proper rollout of programs and cash aid reaches the people to compensate for the non-reduction of VAT and excise tax, stressing the need to look at the bigger picture since the oil crisis will not end in the span of three weeks.