The mandatory fuel marking system under the proposed tax reform measure is expected to curb the about P26.9 billion to P43.8 billion loss in government revenues due to oil smuggling.
The Bureau of Customs plans to conduct the competitive bidding for the procurement of the fuel marking system in the near term for approval in the third quarter of 2017 and implementation by January 1, 2018, Finance Undersecretary Karl Kendrick Chua said in a statement.
Fuel marking is part of the Tax Reform for Acceleration and Inclusion Act (TRAIN), which is now being deliberated in the House of Representative and which Finance officials hope to be approved before the sessions adjourn on June 2.
Chua said cost of the five-year fuel marking program is estimated to be recovered in it’s first year of implementation.
He noted that Asian Development Bank has estimated revenue lost from oil smuggling to be around P37.5 billion while oil industry estimates pegs it around P43.8 billion.
Also, the Institute for Development and Econometric Analysis estimates that smuggled gasoline accounts for around 23 percent of gasoline consumption from 2000-06 while smuggled diesel account for 6 percent on the average, he added.
Latest revenues from petroleum products totaled to PHP52.56 billion. (PNA)
