SEVENTEENTH CONGRESS OF THE )

REPUBLIC OF THE PHILIPPINES ) .
Second Regular Session ) 18 MAY 10 (Pp el
SENATE
RECE: i
S.No.__1798 J+—

Introduced by Senator Paolo Benigno “Bam” A. Aquino IV

AN ACT AMENDING THE NATIONAL INTERNAL REVENUE CODE (NIRC) OF
1997, AS AMENDED, BY PROVIDING THE AUTOMATIC SUSPENSION OF
THE EXCISE TAX ON FUEL UNDER REPUBLIC ACT NO. 10963
OTHERWISE KNOWN AS THE “TAX REFORM FOR ACCELERATION
AND INCLUSION (TRAIN)”

EXPLANATORY NOTE

Philippine laws must protect, serve and empower the Filipino people.

One major threat we need to protect our countrymen from is inflation — rising
prices of goods and services that put a strain on the average Filipino’s daily struggle.

By the end of 2017, over 10 million Filipino families still considered
themselves poor. That is 10 million households struggling to provide food and
shelter, striving to earn an education and desperately searching to find sufficient
livelihood.

Higit sampung milyong pamilya ang nababalisa tuwing tumataas ang presyo
ng bilihin tulad ng bigas, sardinas, kuryente at pamasahe.

More than just tightening their budget, these families will have to scramble
for higher pay, for odd jobs and ‘sidelines’, and even micro-loans, just to cover basic
household expenses.



With so many Filipinos living in the fringes, the government needs to play an
active role in managing inflation and ensure that our countrymen can survive the
rise in prices.

As such, this measure seeks to protect underprivileged Filipino families from
increasing fuel prices, and its effect on the prices of goods and services, by
suspending the excise tax on fuel under TRAIN when the average inflation rate
Surpasses the annual inflation target range over a three-month period.

Should the average inflation rate stabilize and fall below the annual target for
three consecutive months, then the Department of Finance (DOF) will have the
Prerogative to lift the suspension and re-impose the excise tax on fuel based on its
rate at the time of suspension.

While we have little control over global fuel prices, the imposition of excise
taxes is in our hands.

It is our responsibility to be flexible and responsive when the weight of
inflation becomes too heavy for the poor Filipino families to bear.

Progress cannot be built at the expense of hungry Filipinos with little
opportunity to improve their day-to-day lives.

Our challenge is to strike a balance between our macroeconomic goals and
Providing relief and support to Filipinos with the least in our society; and with open
minds, open hearts, creativity and innovation, I believe we can find that delicate
balance and create a prosperous future for all.



In view of the foregoing, the Passing of this bill is earnestly sought.

Bow Cerne



SEVENTEENTH CONGRESS OF THE ) ~
REPUBLIC OF THE PHILIPPINES )

Second Regular Session ) "18 MAY 10 27
SENATE

s.no._1798 Le i

Introduced by Senator Paolo Benigno “Bam” A. Aquino IV

AN ACT AMENDING THE NATIONAL INTERNAL REVENUE CODE (NIRC) OF
1997, AS AMENDED, BY PROVIDING THE AUTOMATIC SUSPENSION OF
THE EXCISE TAX ON FUEL UNDER REPUBLIC ACT NO. 10963
OTHERWISE KNOWN AS THE “TAX REFORM FOR ACCELERATION
AND INCLUSION (TRAIN)”

Be it enacted by the Senate and House of Representatives of the Philippines in
Congress assembled:

Section 1. A new section designated as Section 148-B under Chapter 1, Title
VI of the National Internal Revenue Code (NIRC) of 1997, as amended by Republic
Act (RA) No. 10963, otherwise known as the “Tax Reform for Acceleration and
Inclusion (TRAIN),” is inserted to read as follows:

“Section 148-B. AUTOMATIC SUSPENSION OF THE EXCISE TAX
ON FUEL. - THE IMPOSITION OF EXCISE TAX ON FUEL UNDER
RA NO. 10963 (TRAIN) SHALL BE AUTOMATICALLY
SUSPENDED WHEN THE AVERAGE INFLATION RATE FOR A
THREE MONTH PERIOD EXCEEDS THE ANNUAL INFLATION
TARGET RANGE THAT WAS SET BY THE DEVELOPMENT BUDGET
COORDINATION COMMITTEE (DBCC) AND THE BANGKO
SENTRAL NG PILIPINAS (BSP): PROVIDED, HOWEVER, THAT
THE EXCISE TAX ON FUEL PRIOR TO THE EFFECTIVITY OF RA
10963 (TRAIN) SHALL REMAIN IN FORCE DURING THE
PERIOD OF SUSPENSION.



aa

IN THE EVENT THAT THE INFLATION RATE FALLS BELOW THE
ANNUAL INFLATION TARGET FOR THREE CONSECUTIVE
MONTHS, THE DEPARTMENT OF FINANCE MAY LIFT THE
SUSPENSION OF THE EXCISE TAX ON FUEL UNDER RA NO.
10963 (TRAIN) UPON RECOMMENDATION OF THE DBCC. THE
RATE OF EXCISE TAX ON FUEL SHALL BE RE-IMPOSED BASED
ON ITS RATE AT THE TIME OF SUSPENSION.”

Sec. 2. Implementing Rules and Regulations. — Within thirty (30) days from
the effectivity of this Act, the Secretary of Finance shall, upon recommendation of
the Commissioner of Internal Revenue, promulgate the necessary rules and
regulations for the effective implementation of this Act.

Sec. 3. Separability Clause. — If any provision of this Act is declared invalid or
unconstitutional, the other provisions hereof which are not affected thereby shall
Continue to be in full force and effect.

Sec. 4. Repealing Clause. —Any law, presidential decree or issuance,
executive order, letter of instruction, administrative order, rule or regulation contrary
to or inconsistent with any provision of this Act is hereby repealed or modified
accordingly.

Sec. 5. Effectivity. —This Act shall take effect fifteen (15) days after its
Publication in the Official Gazette or a newspaper of general circulation.

Approved,