TWENTIETH CONGRESS OF THE ) 
REPUBLIC OF THE PHILIPPINES ) 
First Regular Session 
)
25 JUL-3 P5 -54
S.B. No.
SENATE120
Introduced by SENATOR IMEE R. MARCOS
AN ACT
GRANTING THE PRESIDENT OF THE PHILIPPINES THE POWER TO LOWER 
THE RATE OR SUSPEND THE IMPOSITION OF VALUE-ADDED TAX ON 
PETROLEUM PRODUCTS FOR A LIMITED PERIOD OF ONE (1) YEAR IN 
TIMES OF NATIONAL EMERGENCY OR STATE OF CALAMITY, AMENDING 
FOR THE PURPOSE SECTIONS 106 AND 107 OF THE NATIONAL INTERNAL
REVENUE CODE, AS AMENDED
EXPLANATORY NOTE
Article II, Section 9 of the Constitution provides that, the "State shall promote a 
just and dynamic soda! order that will ensure the prosperity and independence of the 
nation and free the people from poverty through policies that provide adequate soda! 
services, promote full employment, a rising standard of living, and an improved quality 
of life of all."
Since the implementation of Republic Act No. 10963, otherwise known as the 
Reform for Acceleration and Inclusion (TRAIN) Law, fuel prices have steadily risen. 
These oil price hikes have had a noticeable domino effect on the prices of basic goods 
and services, such as agricultural products, transportation, food, electricity and other 
essentials. The recent situation, including the new Israel-Iran crisis have threatened 
the passage of oil via the Strait of Hormuz, where 20% of the petroleum market flows 
through. For the month of June 2025, pump prices increased by PhP 6.30 per liter for 
gasoline, PhP 8.25 per liter for diesel and PhP 6.50 per liter for kerosene.
The higher cost of petroleum products continues to exert upward pressure on 
inflation, undermining the gains made in the previous months. While inflation continues 
to stay under the 2-4% target band of the BSP, the geopolitical uncertainty associated 
with the fragile peace in the Middle East makes government intervention imperative.


In view of the current situation of the country, which has just recovered from a 
bout of high inflation brought upon by increasing food prices, there is a need to give 
some relief to the Filipinos and ensure their survival and recovery. The government 
should not earn windfall profits on price increases in basic commodities and inputs. As 
a means of easing the financial burden of the public, this bill proposes to grant the 
President of the Philippines the power to temporarily lower the rate or suspend the 
imposition of Value-Added Tax on petroleum products in times of national emergency 
or a state of calamity, such as this crisis. To ensure fiscal sustainability on the part of 
the Government, excise taxes imposed on the petroleum products will be retained.
In view of the foregoing reasons, the passage of this bill is earnestly sought.
. MARCOS


TWENTIETH CONGRESS OF THE ) 
REPUBLIC OF THE PHILIPPINES ) 
First Regular Session 
)
25 JUL -3 P5 :54
SENATE
S.B. No. 120
Introduced by SENATOR IMEE R. MARCOS
AN ACT
GRANTING THE PRESIDENT OF THE PHILIPPINES THE POWER TO LOWER 
THE RATE OR SUSPEND THE IMPOSITION OF VALUE-ADDED TAX ON 
PETROLEUM PRODUCTS FOR A LIMITED PERIOD OF ONE (1) YEAR IN 
TIMES OF NATIONAL EMERGENCY OR STATE OF CALAMITY, AMENDING 
FOR THE PURPOSE SECTIONS 106 AND 107 OF THE NATIONAL INTERNAL
REVENUE CODE, AS AMENDED
Be it enacted by the Senate and House of Representatives of the Philippines in Congress 
assembled:
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SECTION 1. Section 106 of the National Internal Revenue Code of 1997, as
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amended, is further amended to read:
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"Section 106. Value-added Tax on Sale of Goods or Properties. -
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(A) Rate and Base of Tax - There shall be levied, assessed and collected
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on every sale, barter or exchange of goods or properties, a value added
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tax equivalent to twelve percent (12%) of the gross selling price or gross
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value in money of the goods or properties sold, bartered or exchanged,
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suck tax to be paid by the seller or transferor. PROVIDED, THAT THE
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PRESIDENT OF THE PHILIPPINES, BY VIRTUE OF AN EXECUTIVE
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ORDER, AFTER CONSULTATION WITH THE SECRETARY OF
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FINANCE, MAY 
LOWER THE RATE OR SUSPEND THE
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IMPOSITION OF THE VALUE-ADDED TAX ON THE SALES OF
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PETROLEUM PRODUCTS IN TIMES OF A DULY DECLARED STATE
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OF NATIONAL EMERGENCY OR STATE OF CALAMITY FOR A
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PERIOD NOT EXCEEDING ONE (1) YEAR UPON DETERMINATION
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BY THE PRESIDENT THAT SUCH LOWERING OF RATE OR
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SUSPENSION IS NECESSARY TO PROTECT PUBLIC INTEREST
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AND WELFARE.


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XXX.
SEC. 2. Section 107 of the National Internal Revenue Code of 1997, as amended, 
is further amended to read:
"Section 107. Value-added Tax on the Importation of goods. - (A)
In General. - There shall be levied, assessed and collected on every 
importation of goods a value-added tax equivalent to twelve percent 
(12%) based on the total value used by the Bureau of Customs in 
determining tariff and customs duties, plus excise taxes, if any, and other 
charges, such tax to be paid by the importer prior to the release of such 
goods from customs custody: Provided, That where the customs duties 
are determined on the basis of the quantity or volume of the goods, the 
value-added tax shall be based on the landed cost plus excise taxes, if 
any. PROVIDED FURTHER, THAT THE PRESIDENT OF THE 
PHILIPPINES, BY VIRTUE OF AN EXECUTIVE ORDER, AFTER 
CONSULTATION WITH THE SECRETARY OF FINANCE, MAY 
LOWER THE RATE OR SUSPEND THE IMPOSITION OF THE 
VALUE-ADDED TAX ON THE IMPORTATION OF PETROLEUM 
PRODUCTS IN TIMES OF A DULY DECLARED STATE OF 
NATIONAL EMERGENCY OR STATE OF CALAMITY FOR A PERIOD 
NOT EXCEEDING ONE (1) YEAR UPON DETERMINATION BY THE 
PRESIDENT THAT SUCH LOWERING OF RATE OR SUSPENSION 
IS NECESSARY TO PROTECT PUBLIC INTEREST AND WELFARE.
X X X."
SEC. 3. Implementing Rules and Regulations. - Within thirty (30) days from the 
effectivity of this Act, the Secretary of Finance, in coordination with the Bureau of 
Internal Revenue, shall promulgate the necessary rules and regulations for its effective 
implementation.
SEC. 4. Repealing Clause. - All other laws, decrees, executive orders and 
issuances, proclamations, rules and regulations, and other issuances or parts thereof 
that are inconsistent with the provisions of this Act are hereby repealed or amended, 
accordingly.
SEC. 5. Separability Clause. - If any provision of this Act shall be declared 
unconstitutional or invalid, the other provisions not otherwise affected shall remain in 
full force and effect.
SEC. 6. Effectivity. - This Act shall take effect fifteen (15) days after its 
publication in the Official Gazette or in a newspaper of general circulation.
Approved,