Reduction of Rates of Import Duty on Crude Petroleum Oils and Refined Petroleum Products
Executive Order No. 440, issued on June 29, 2005, modifies the rates of import duty on crude and refined petroleum products in the Philippines, reinstating the original duty rates of 3% for various petroleum items as outlined in the attached Annex. This order reflects the authority granted to the President under the Tariff and Customs Code and aligns with commitments made under the ASEAN Free Trade Area. The adjustment is part of a broader strategy to manage the impact of the recently enacted Republic Act No. 9337, which expands the value-added tax (VAT) on petroleum products, thus affecting retail prices. The order is effective immediately upon the enactment of the VAT Reform Law and supersedes any conflicting prior regulations.
Law Information
- Reference Number
- Executive Order No. 440
- Date Enacted
- Category
- Presidential Issuances
- Subcategory
- Executive Orders
- Jurisdiction
- Philippines
- Enacting Body
- Congress of the Philippines
Full Law Text
June 29, 2005
EXECUTIVE ORDER NO. 440
REDUCTION OF THE RATES OF IMPORT DUTY ON CRUDE PETROLEUM OILS AND REFINED PETROLEUM PRODUCTS UNDER EXECUTIVE ORDER 336, SERIES OF 2004, "MODIFYING THE RATES OF IMPORT DUTY ON CRUDE PETROLEUM OILS AND REFINED PETROLEUM PRODUCTS UNDER SECTION 104 OF THE TARIFF AND CUSTOMS CODE OF 1978 (PD 1464), AS AMENDED"
WHEREAS, Section 6 (Tariff Treatment) of RA 8479, otherwise known as the "Downstream Oil Industry Deregulation Act of 1998," provides: "Any law to the contrary notwithstanding and starting with the effectivity of this Act, a single and uniform tariff duty shall be imposed and collected both on imported crude oil and imported refined petroleum products at the rate of three percent (3%): Provided, however, that the President of the Philippines may, in the exercise of his powers, reduce such tariff rate when in his judgment such reduction is warranted, pursuant to Republic Act No. 1937, as amended, otherwise known as the "Tariff and Customs Code": Provided, further, That beginning January 1, 2004 or upon implementation of the Uniform Tariff Program Under the World Trade Organization and ASEAN Free Trade Area commitments, the tariff rate shall be automatically adjusted to the appropriate level notwithstanding the provisions under this Section".
WHEREAS, Sections 401 and 402 of the Tariff and Customs Code of 1978 (Presidential Decree No. 1464), as amended, empower the President of the Republic of the Philippines to increase, reduce, or remove existing rates of import duty, as well as to modify the form of duty and the tariff nomenclature, under Section 104 of the Code;
WHEREAS, the adjustment in import duty per Executive Order No. 336 is only an interim revenue measure until Congress enacts new laws on taxes for petroleum products;
WHEREAS, the Government has a commitment with the Association of Southeast Asian Nations (ASEAN) Free Trade Area Council to adjust the levels of duty when new laws on taxes for petroleum products are passed;
WHEREAS, the recently-passed Republic Act No. 9337 (RA 9337), expanding the base of the value-added tax (VAT), will result in increased Government revenues by imposing, among ethers, VAT on petroleum products;
WHEREAS, the implementation of RA 9337 will result to an increase in retail prices of LPG of over P40.00 per 11-kg cylinder and average of about P1.70/liter, for petroleum products despite the rationalization of excise taxes/reduction to zero of the excise tax on socially-sensitive products (kerosene, diesel and fuel oil); cTCADI
NOW, THEREFORE, I GLORIA MACAPAGAL-ARROYO, President of the Philippines, by virtue of the powers vested in me by law, do hereby order:
SECTION 1. The articles specifically listed in Annex "A" hereof, as classified under Section 104 of the Tariff and Customs Code of 1978, as amended, whose duties were adjusted from three percent (3%) to five percent (5%) by virtue of Executive Order 336, shall be subject to its original rates of import duty [Most-Favored-Nation (MFN) and ASEAN Free Trade Area (AFTA) — Common Effective Preferential Tariff (CEPT)] indicated in Columns 4 and 5 opposite each article.
SECTION 2. The AFTA-CEPT rates so indicated in Annex "A" shall be accorded to imports coming from ASEAN Member States applying CEPT concession to the same product pursuant to Article 4 of the Agreement on the CEPT Scheme for the ASEAN Free Trade Area (CEPT Agreement),signed on 28 January 1992, and its Interpretative Notes.
SECTION 3. The rates of import duty on tariff headings not enumerated and those listed but represented by the symbol "X X X" shall remain in force and in effect.
SECTION 4. Upon the effectivity of this Executive Order, all articles listed in Annex "A" which are entered and withdrawn from warehouses in the Philippines for consumption shall be levied the MFN rates of duty therein prescribed.
SECTION 5. Upon the effectivity of this Executive Order, all articles listed in Annex "A" which are entered and withdrawn from warehouses in the Philippines for consumption shall be imposed the AFTA-CEPT rates of duty therein prescribed subject to qualification under the Rules of Origin as provided for in the CEPT Agreement. cSaADC
SECTION 6. All presidential issuances, administrative rules and regulations or parts thereof, which are contrary to or inconsistent with this Executive Order are hereby revoked or modified accordingly.
SECTION 7. This Executive Order shall be published in two (2) newspapers of general circulation in the Philippines and shall take effect on date of effectivity of RA 9337 or the VAT Reform Law.
DONE in the City of Manila, this 29th day of June, in the year of Our Lord, Two, Thousand and Five.
ANNEX "A"
| Heading | Tariff Code | Description | Rate of Duty % | |
| MFN | CEPT | |||
| (1) | (2) | (3) | (4) | (5) |
| 27.09 | Petroleum oils and oils obtained | |||
| from bituminous minerals, crude | ||||
| 2709.00.10 | - Crude petroleum oil | 3 | 3 | |
| 2709 00 20 | - Condensate | 3 | 3 | |
| 2709.00.90 | - Other | 3 | 3 | |
| 27.10 | Petroleum oils and oils obtained from | |||
| bituminous minerals, other than crude; | ||||
| preparations not elsewhere specified or | ||||
| included, containing by weight 70% | ||||
| or more of petroleum oils or of oils | ||||
| obtained from bituminous minerals, these | ||||
| oils being the basic constituents of the | ||||
| preparations; waste oils. | ||||
| - Petroleum oils and oils obtained from | ||||
| bituminous minerals (other than crude) | ||||
| and preparations not elsewhere specified | ||||
| or included, containing by weight 70% or | ||||
| more of petroleum oils obtained from | ||||
| bituminous minerals, these oils being | ||||
| the basic constituents of the preparations, | ||||
| other than waste oils: | ||||
| 2710.11 | - - Light oils and preparations: | |||
| 2710.11.11 | - - - Motor spirit, premium leaded | 3 | 3 | |
| 2710.11.12 | - - - Motor spirit, premium unleaded | 3 | 3 | |
| 2710.11.13 | - - - Motor spirit, regular leaded | 3 | 3 | |
| 2710.11.14 | - - - Motor spirit, regular unleaded | 3 | 3 | |
| 2710.11.15 | - - - Other motor spirit, leaded | 3 | 3 | |
| 2710.11.16 | - - - Other motor spirit, unleaded | 3 | 3 | |
| 2710.11.17 | - - - Aviation spirit | 3 | 3 | |
| 2710.11.18 | - - - X X X | |||
| 2710.11.21 | - - - White spirit | 3 | 3 | |
| 2710.11.22 | - - - Low aromatic solvents containing by weight | |||
| less than 1% aromatic content | 3 | 3 | ||
| 2710.11.23 | - - - Other solvent spirits | 3 | 3 | |
| 2710.11.24 | - - - Naphtha; reformate or preparations for | |||
| preparing spirits | 3 | 3 | ||
| 2710.11.25 | - - - Other light oil | 3 | 3 | |
| 2710.11.29 | - - - Other | 3 | 3 | |
| 2710.19 | - - Other: | |||
| - - - Medium oil and preparations: | ||||
| 2710.19.11 | - - - - Lamp kerosene | 3 | 3 | |
| 2710.19.12 | - - - - Other kerosene, including vaporizing oil | 3 | 3 | |
| 2710.19.13 | - - - - Aviation turbine fuel (jet fuel) having a | |||
| flash point of not less than 23º C | 3 | 3 | ||
| 2710.19.14 | - - - - Aviation turbine fuel (jet fuel) having a | |||
| flash point of less than 23º C | 3 | 3 | ||
| 2710.19.15 | - - - - Normal paraffin | 3 | 3 | |
| 2710.19.19 | - - - - Other medium oils and preparations | 3 | 3 | |
| - - - Other: | ||||
| 2710.19.21 | - - - - Topped crudes | 3 | 3 | |
| 2710.19.22 | - - - X X X | |||
| 2710.19.23 | - - - - Lubricating oil base stock | 3 | 3 | |
| 2710.19.24 | - - - - Lubricating oils for aircraft engines | 3 | 3 | |
| 2710.19.25 | - - - - Other lubricating oil | 3 | 3 | |
| 2710.19.26 | - - - - Lubricating greases | 3 | 3 | |
| 2710.19.27 | - - - - Hydraulic brake fluid | 3 | 3 | |
| 2710.19.28 | - - - - Oil for transformer or circuit breakers | 3 | 3 | |
| 2710.19.31 | - - - - High speed diesel fuel | 3 | 3 | |
| 2710.19.32 | - - - - Other diesel fuel | 3 | 3 | |
| 2710.19.33 | - - - - Other fuel oils | 3 | 3 | |
| 2710.19.39 | - - - - Other | 3 | 3 | |
| - Waste oils: | ||||
| 2710.91.00 | - - Containing polychlorinated biphenyls | |||
| (PCBs) polychlorinated terphenyls (PCTs) | ||||
| or polybrominated biphenyls (PBBs) | 3 | 3 | ||
| 2710.99.00 | - - Other | 3 | 3 | |
| 27.11 | Petroleum gasses and other gaseous hydrocarbons. | |||
| - Liquefied | ||||
| 2711.11.0 | - - X X X | |||
| 2711.12.0 | - - Propane | 0 | 0 | |
| 2711.13.0 | - - Butanes | 0 | 0 | |
| 2711.14 | - - X X X: | |||
| 2711.14.10 | - - - X X X | |||
| 2711.14.90 | - - - X X X | |||
| 2711.19.00 | - - Other | 0 | 0 | |
| 27.13 | Petroleum coke, petroleum bitumen and | |||
| other residues of petroleum oils or of oils | ||||
| obtained from bituminous minerals. | ||||
| - Petroleum coke: | ||||
| 2713.11.00 | - - Not calcined | 3 | 3 | |
| 2713.12.00 | - - calcined | 3 | 3 | |
| 2713 20.00 | - Petroleum bitumen | 3 | 3 | |
| 2713.90.00 | - Other residues of Petroleum oils or of oils | |||
| obtained from bituminous minerals | 3 | 3 |
Published in The Manila Times on June 30, 2005.
Cite This Law
Reduction of Rates of Import Duty on Crude Petroleum Oils and Refined Petroleum Products, Executive Order No. 440, Jun 29, 2005 (Philippines)
Reduction of Rates of Import Duty on Crude Petroleum Oils and Refined Petroleum Products, Executive Order No. 440 (Phil. 2005)
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