RUSH June 2018

RUSH
tax reform law 101:
all you need to know
President Rodrigo Duterte signed into
law the Tax Reform for Acceleration and
Inclusion (TRAIN) on December 19, 2017.
The tax reform, which took effect at the
start of 2018, is expected to generate almost P150
billion in revenues, which will be used for various
infrastructure projects and social services.
Among the implemented revenue enhancing
measures were adjusting the excise taxes on fuel and
automobiles and the broadening of the value-added
tax base. Particularly for the oil and gas industry, the
new law also included the tax administration reform
called the mandatory fuel marking program.
Slated to start within five years of the
implementation of TRAIN, the fuel marking program
calls for all petroleum products imported to or
manufactured in the Philippines, to carry an official
fuel marking technology that will ensure the
payment of duties and taxes laid out in the TRAIN
law. The program aims to curb oil smuggling,
which is a rampant problem in the Philippines. The
Department of Finance (DOF) expects the system to
be in place by the second half of 2018.
WHERE THE TAXES WILL GO
INFRASTRUCTURE
PROGRAMS
EDUCATION
HEALTHCARE
SERVICES
In the next 5 years, the tax reform can fund:
35,745 km of paved roads or
786,400 km of temporary
bridge upgrades or
2.6 million hectares of
irrigated land.
629,120 public school
classrooms, or
2,685,101 public school
teachers.
60,483 rural health units, or
484,326 barangay health
stations, or
1,324 provincial hospitals.
New Excise Tax Rates for Fuel:
Automobile Excise Tax:
Fuel (per liter)
2017 and
prior years
2018 2019 2020
Price
Non-Hybrid
Cars
Hybrid
Cards
Diesel
0
Php 2.50
Php 4.50 Php 6.00
Up to 600,000
Over 600,000 to 1 Million
4%
10%
2%
5%
LPG
0
Php 1.00 / kg
Php 2.00 / kg Php 3.00 / kg
Over 1 Million to 4 Million
20%
10%
Gasoline
Php 4.35
Php 7.00 Php 9.00 Php 10.00
Over 4 Million 50% 25%
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