The Bureau of Internal Revenue (BIR) has issued Revenue Regulations (RR) 3-2026 to implement Executive Order (EO) 114, series of 2026, which temporarily suspends excise taxes on specific petroleum products. This move follows sustained increases in global oil prices, triggered when the average Dubai crude oil price, based on the Mean of Platts Singapore, reached at least US$80 per barrel.
Petroleum Products Covered
The temporary suspension applies to liquefied petroleum gas (LPG), except when used as raw material for petrochemical production or as motive power, and kerosene, except when used as aviation fuel. The suspension covers products removed from the place of production or customs custody after the EO's effectivity.
Duration of Suspension
The suspension will remain in effect for three months from the EO's effective date and is subject to monthly review by the Development Budget Coordination Committee (DBCC). Excise tax rates under Section 148 of the Tax Code will automatically revert to original rates upon the earlier of: one week after the one-month average Dubai crude oil price falls below US$80 per barrel, as certified by the Department of Energy, or the expiration of the three-month suspension period.
Monitoring and Inventory Requirements
During the suspension, the BIR and the Bureau of Customs (BOC) must submit monthly reports to Congress on the declared value and volume of covered petroleum products. The Department of Finance, through the BIR and BOC, will conduct an inventory of existing LPG and kerosene stocks as of the EO's effectivity. Revenue officers on premises will continue monitoring taxpayer activities in accordance with the Tax Code.
Reportorial Requirements
Manufacturers of domestically produced LPG and kerosene must continue filing excise tax returns reflecting a zero-tax rate, with the remark “EO No. 114, series of 2026,” and submit corresponding official registry books. Importers must file excise tax returns with the BOC and secure authority to release imported goods bearing the same EO remark. Concerned taxpayers must also submit duly notarized stock inventory reports within 10 days from the EO's effectivity. Withdrawal certificates for covered products must clearly indicate EO coverage.
Effectivity
RR 3-2026 took effect immediately upon its publication on the BIR website on April 17, 2026.
