Economic Impact of Fuel Price Hikes Greater than Excise Tax Loss — PCCI

Why It Matters

Stabilizing fuel prices protects the vast MSME sector, safeguarding jobs and preventing a broader economic slowdown in the Philippines.

Key Takeaways

• PCCI backs emergency powers to curb soaring fuel prices.
• MSMEs face closure risk from fuel price spikes.
• Potential tax cut loss of ₱136 billion outweighed by economic damage.
• 4‑day work week seen as limited solution for energy savings.
• Calls for revisiting 1998 oil deregulation amid ongoing crisis.

Summary

The Philippine Chamber of Commerce and Industry (PCCI) urged President Marcos to be granted emergency powers to stabilize oil prices, arguing that the economic fallout from fuel hikes far exceeds the ₱136 billion loss from suspending excise taxes. The chamber highlighted that the current crisis threatens the viability of roughly 1.2 million micro, small and medium enterprises (MSMEs), which constitute about 90 % of the nation’s business community.

PCCI officials emphasized that energy is the lifeline of the economy; even modest increases in fuel, transport, or logistics costs can push many MSMEs into insolvency. While wealthier consumers might benefit from tax relief, the chamber noted that large corporations represent less than half a percent of businesses, making the broader impact on MSMEs the decisive factor.

In the interview, President Petty Fer cited a statement that “energy is the lifeline of the economy” and pointed out that 99.6 % of Philippine businesses are MSMEs. He also addressed the proposal of a four‑day work week, calling it a partial, industry‑specific measure rather than a universal solution, and urged a review of the 1998 oil deregulation law to improve policy flexibility.

If emergency powers are granted, the government could intervene to cap fuel prices, easing pressure on logistics and consumer costs. Such action would help preserve MSME operations, curb inflationary pressures, and maintain employment, while also prompting longer‑term regulatory reforms in the energy sector.

Original Description

#TheBigStory | PCCI President Perry Ferrer said they believe that the economic impact of higher fuel costs extends far beyond large companies, affecting ordinary consumers and micro, small, and medium enterprises (MSMEs) across the country.

Ferrer said that the broader effect on the economy could be more significant than the estimated P130 billion in government revenue that would be lost if the excise tax on fuel were suspended.

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