The delayed implementation of the VAT exemption on indigenous natural gas—meant to lower electricity costs for millions of consumers, including senior citizens—has raised concerns amid questions on why the mandated tax relief remains unenforced despite completed guidelines from government agencies.
Senior Citizens Party-list Representative Rodolfo “Ompong” Ordanes has filed House Resolution No. 472 urging the House Committee on Energy to investigate, in aid of legislation, the continued non-implementation of the VAT removal required under Republic Act No. 12120, or the Philippine Natural Gas Industry Development Act.
RA 12120, enacted on January 8, 2025, exempts the sale of indigenous natural gas—and the electricity generated from it—from VAT to help reduce power costs for Filipino households, particularly seniors and low-income consumers.
The Department of Energy released the Implementing Rules and Regulations on April 8, 2025, followed by the Bureau of Internal Revenue’s Revenue Memorandum Circular No. 11-2025. Both took effect in April.
Despite these, power plants using indigenous natural gas are still being charged 12% VAT, resulting in households consuming around 200 kWh monthly paying about ₱42 per billing cycle—an amount that should have already been eliminated.
Ordanes warned that the delay undermines the law’s objective to ease the financial burden on consumers. He also wrote to DOE Secretary Sharon Garin seeking an update on the implementation status and requesting a time-bound action plan.
House Resolution No. 472 aims to identify bottlenecks, ensure accountability from implementing agencies, and close policy gaps preventing the immediate rollout of the VAT exemption.