IBON Foundation Pushes for Wealth Tax and Fund Reallocation to Counter Oil Price Shock
In response to the escalating oil price crisis triggered by conflicts involving the United States, Israel, and Iran, the IBON Foundation has issued a strong appeal to the Philippine government. The organization is urging the implementation of a wealth tax and a reduction in certain local projects to protect citizens from the adverse effects of rising fuel costs.
Executive Director Sonny Africa's Recommendations
During an interview with Bombo Radyo Roxas, IBON Foundation Executive Director Sonny Africa emphasized the need for immediate action. He proposed the removal of Value-Added Tax (VAT) and excise taxes on oil as a measure to alleviate the financial burden on consumers and stimulate spending. Africa highlighted that this step could provide significant relief to households grappling with inflated energy expenses.
However, Africa stressed that a more transparent and effective system is essential to assist not only the impoverished but also the middle class, who are increasingly feeling the pinch of soaring oil prices. He pointed out that the current economic strain requires targeted interventions to ensure broad-based support.
Potential Revenue from Wealth Tax
Africa detailed the proposed wealth tax, which would impose a rate of one to three percent on assets exceeding P1 to P3 billion. This initiative is projected to generate approximately P500 to P600 billion in revenue within a single year. Such funds could be pivotal in financing social services and cushioning the impact of the energy crisis on vulnerable populations.
Reallocation of Infrastructure Funds
In addition to the wealth tax, Africa suggested reallocating or reducing portions of the budget allocated to government infrastructure projects. By redirecting these resources toward social services, the government could better mitigate the crisis's effects on Filipinos. This strategic shift aims to prioritize immediate humanitarian needs over long-term developmental projects during this period of economic hardship.
Current Fuel Price Situation
According to the Department of Energy, fuel prices have reached unprecedented levels. In Metro Manila, unleaded gasoline now costs between P69 and P90 per liter following a second major oil price hike on March 17, 2026. Diesel prices have surged past P100 per liter, marking the highest recorded rates in the nation's history. This dramatic increase has intensified the energy crisis, placing immense pressure on citizens' daily expenses and overall economic stability.
The IBON Foundation's proposals come at a critical juncture, as the Philippines navigates one of its most challenging energy price shocks. The call for a wealth tax and fund realignment underscores the urgency of adopting innovative fiscal measures to safeguard public welfare amid global geopolitical tensions.
