Gov't Cuts Tariff on Imported Oil; EO Aims to Cushion Impact of Rising Oil Prices Lower Petroleum Tariff Expected to Help Consumers
Byline: Genalyn D. Kabiling
President Arroyo has issued Executive Order 691, implementing a temporary reduction in oil tariff to cushion the impact of soaring world oil prices on the domestic economy and the people.
In an order dated Jan. 10, the President said the tariff rates on crude petroleum oils and refined petroleum products would be reduced, depending on "trigger prices" in the world crude market.
The government had earlier said the reduction in the import tariff from 3 percent to 2 percent will translate into lower diesel prices and prevent an inflation spiral.
"An automatic tariff mechanism based on certain triggers indexed to international oil prices would soften the impact of high and rising world prices on the economy and the consuming public without necessarily draining government revenues," EO 691 said.
The directive will take effect after publication in two national newspapers.
Under EO 691, the President said the Department of Energy (DoE) must issue a certification that a trigger price has been reached before the reduction in oil tariff would come into effect. The energy department would then notify the Department of Finance (DoF) and a corresponding customs memorandum order would be issued by the Bureau of Customs (BoC). …