In the league of the domestic oil players, Eastern Petroleum first made announcement on its price adjustments at P0.60 per liter for diesel; P0.70 per liter for unleaded gasoline; P0.70 per liter for its premium intensity; P0.65 per liter for regular gasoline and P0.55 per liter for kerosene.

The price hikes imposed by the upstart oil firm is not far off from the calculation laid down by the Department of Energy; wherein it forecasted an increase of P0.67 per liter for unleaded gasoline; P0.63 per liter for regular gasoline; P0.58 per liter for diesel; P0.60 per liter for kerosene and roughly P8.90 to P9.80 for the 11-kilogram tank of liquefied petroleum gas; or P0.80 to P0.89 per kilogram translated.

The overall impact, he said, would be 1.8 percent, which means that it was softened a bit from the mandated 2.0 percent.

As of press time, no oil firm has followed yet Eastern Petroleum’s initiated price adjustment; but most players indicated they would also be increasing their pump prices.

Energy Secretary Raphael P.M. Lotilla has emphasized that even with the price adjustment from the additional VAT charges, there is still a net decline in pump prices as compared to November level when the 10-percent VAT charges was implemented.

For electricity, the estimate would just be a little more than 1.0-percent hike in the rates to be paid by residential consumers.

Based on initial computation set out by the Manila Electric Company, this would convert to P0.10 per kilowatt hour (kWh) hike in its customers’ electricity bills.

"The expected increase in fuel and electricity prices is minimal…simulations made by the DoE showed that the impact on local retail prices of all products will be less than 2-percent for oil and only about 1.0-percent for electricity," the energy chief stressed.

It could be gleaned from data furnished by the energy department that retail prices after the imposition of the additional VAT would be at about P37.25 per liter for unleaded gasoline, lower by P1.17 per liter from November’s P38.42 per liter.

For other products, the estimated prices are: P35.06 as compared to November’s P36.37 per liter; diesel at P32.25 from P33.17; kerosene at P33.78 from P34.91 per liter.

To ensure that there is no double computation made on the tax levied, Lotilla explained that they set estimation by stripping first the 10-percent VAT charge from prevailing retail price; and then they calculated the new VAT at 12-percent.

From petroleum products alone, the Department of Finance (DoF) has calculated that the higher VAT charges would bring in additional revenue of P6 billion for the government. (MMV)