How the energy emergency and fuel tax relief law operates
By: Atty. Wenver James C. Dela Rosa on April 2, 2026
IN response to global oil market disruptions brought about by the war in the Middle East, President Ferdinand Marcos Jr. recently declared a state of national energy emergency and rolled out a coordinated national response by issuing Executive Order (EO) 110 as the centerpiece of its strategy. The move comes alongside the passage of Republic Act (RA) 12316, which empowered the president to temporarily suspend or reduce excise taxes on petroleum products.
Issued on March 24, 2026, EO 110 declared a one-year energy emergency unless otherwise extended or lifted. As a net importer of petroleum products, the Philippines faces heightened vulnerability to such disruptions, threatening the stability and adequacy of domestic energy supply and creating economic risks.
The legal basis of EO 110 includes Section 17, Article VII of the Constitution, which vests in the president the power of control of all executive departments, bureaus and offices and the mandate to ensure the faithful execution of laws.
It is also supported by Section 25 of RA 7638, or the Department of Energy Act of 1992, which authorizes the president, upon determination and recommendation of the Energy secretary, to act in situations of critically low energy supply.
EO 110 emphasizes the role of the Department of Energy (DOE) in crafting and implementing energy supply management measures, such as enforcing fuel and energy optimization plans and taking action against hoarding, profiteering or manipulation of petroleum product markets. The DOE is also authorized to direct government energy corporations, such as Philippine National Oil Co. (PNOC) and PNOC Exploration Corp., to procure fuel and related petroleum products in order to ensure the efficient and timely availability of supply.
EO 110 also establishes the Unified Package for Livelihoods, Industry, Food and Transport (Uplift), a whole-of-government response framework designed to safeguard energy supply, ensure continuity of essential services, protect vulnerable sectors and mitigate the effects of global energy shocks on the economy. The Uplift Committee, to be chaired by the president and composed of key government agencies, is tasked with overseeing and coordinating the implementation of Uplift measures.
The measures complement the actions of the DOE by providing targeted support to consumers and affected sectors. Among the key functions highlighted under EO 11O are those of the Department of Transportation, which is responsible for mitigating the impact of the energy crisis on the transport sector and the commuting public through fuel and fare subsidies, expansion of public transport services and initiatives to reduce dependence on petroleum products. The EO also tasks the Department of Social Welfare and Development with expediting assistance and providing livelihood support to affected sectors and directs the Department of Trade and Industry to monitor and, when necessary, address unreasonable price increases on basic necessities and prime commodities.
Other agencies are likewise mandated under the EO to carry out measures aligned with their respective mandates, ensuring a coordinated government response to the ongoing energy crisis.
Complementing EO 110 is RA 12316, which was approved on March 25, 2026. RA 12316 provides a fiscal mechanism to alleviate domestic fuel prices. The law authorizes the president to suspend or reduce excise taxes on fuel whenever the Dubai crude oil price, based on Mean of Platts Singapore, reaches or exceeds $80 per barrel for one month. Implementation requires recommendation by the Development Budget Coordination Committee (DBCC), in coordination with the DOE, and may apply to specific petroleum products either fully or partially.
Any suspension or reduction of excise taxes will take effect for up to three months, with the total duration not exceeding one calendar year. The law further provides that fuel excise taxes will automatically revert to their original rates upon occurrence of either the following, whichever comes first: one week after the one-month average Dubai crude oil price falls below $80 per barrel as certified by the DOE, or after three months.
RA 12316 limits the president’s authority to temporarily suspend or reduce excise taxes on petroleum products until Dec. 31, 2028, and requires regular reporting to Congress, through the DBCC and in coordination with the DOE, on the factual basis, estimated foregone revenues, economic impact and policy recommendations on the matter.
Together, EO 110 and RA 12316 provide a coordinated, dual-response strategy. By combining supply side measures with targeted tax relief, the government aims to protect consumers, maintain economic continuity and secure the nation’s energy needs amid global uncertainties. The success of these measures will be closely monitored in the coming months as authorities balance the twin goals of energy security and economic stability.
Wenver James C. Dela Rosa is an Associate of Mata-Perez, Tamayo & Francisco (MTF Counsel). This article is for general information only and is not a substitute for professional advice where the facts and circumstances warrant. If you have any question or comment regarding this article, you may email the author at info@mtfcounsel.com or visit MTF website at www.mtfcounsel.com.
The article was published at the More to Follow Column at The Manila Times on April 2, 2026. Please see this link.