Economists and government officials often warn that reducing oil excise and VAT taxes would mean “unacceptable revenue losses.” But this framing is misleading. As IBON Foundation Executive Director Sonny Africa points out, what’s really at stake is not government revenue, but the daily survival of 21 million of the poorest, low-income, and lower middle-class Filipino families.
Excise and VAT on oil are not neutral levies. They are regressive taxes that disproportionately burden ordinary Filipinos who spend a larger share of their income on basic consumption. Every jeepney ride, every tricycle trip, every kilo of rice transported to the market carries the hidden weight of these taxes. To call their removal a “loss” is to ignore that the money being collected was never surplus—it was extracted from the pockets of those least able to afford it.
The government’s insistence on protecting revenue streams at the expense of social equity reveals a deeper problem: a fiscal mindset that prioritizes balance sheets over human dignity. Cutting oil taxes is not a handout; it is restitution. It is giving back what was taken from families who already live on the margins, families who must choose between fare and food, electricity and medicine.
If policymakers are serious about inclusive growth, they must confront the reality that regressive taxation entrenches inequality. The state should not balance its books on the backs of the poor. Instead, it should pursue progressive revenue measures—taxing wealth, luxury consumption, and corporate windfalls—while relieving ordinary Filipinos of the daily tax on survival.
The debate over oil excise and VAT is not about fiscal prudence versus populism. It is about justice. And justice demands that the poorest Filipinos stop subsidizing a government that too often forgets who it is meant to serve. #
