BIR RMC No. 100-2026: Is LPG and Kerosene Excise Tax Suspended?

Yes — as of BIR Revenue Memorandum Circular (RMC) No. 100-2026, issued September 28, 2026, excise tax on liquefied petroleum gas (LPG) and kerosene is suspended again. The circular implements Executive Order (EO) No. 125, series of 2026, signed by President Marcos Jr. on September 25, 2026, after the Department of Energy (DOE) certified that Dubai crude averaged above the US$80/barrel trigger under Republic Act (RA) No. 12316. LPG used as motive power or petrochemical feedstock, and kerosene used as aviation fuel, are excluded and still taxed.

What RMC No. 100-2026 Actually Suspends #

RMC No. 100-2026 is the BIR’s implementing circular for EO No. 125 — it does not create a new tax rule on its own. It fully suspends excise tax on LPG, except LPG used as raw material for petrochemical products or for motive power, and fully suspends excise tax on kerosene, except kerosene used as aviation fuel. Gasoline and diesel are not part of this suspension at all.

The circular was signed by BIR Commissioner Charlito Martin R. Mendoza and distributed to Revenue District Offices, Large Taxpayers Service units, and petroleum manufacturers/importers on September 28, 2026, the same week EO No. 125 was signed. It instructs excise taxpayers — manufacturers and importers of petroleum products filing BIR Form 2200-P — to compute LPG and kerosene removals from the warehouse at the suspended (effectively zero) rate for the excepted uses carved out above, while continuing to apply the regular rate to any LPG or kerosene removed for motive power, petrochemical, or aviation use.

Why the Suspension Was Triggered: The $80-Per-Barrel Rule Under RA No. 12316 #

RA No. 12316 built an automatic price-trigger mechanism into the law itself: once the one-month average Dubai crude price, on a Mean of Platts Singapore (MOPS) basis, hits or exceeds US$80 per barrel, the President may suspend or reduce excise tax on affected petroleum products on the Development Budget Coordination Committee’s (DBCC) recommendation, in coordination with the DOE.

That threshold was breached again in September 2026. The DOE certified that Dubai crude averaged US$99.41 per barrel on a MOPS basis from August 13 to September 11, 2026 — roughly 24% above the $80 trigger — and the DBCC’s recommendation gave Marcos the legal basis to sign EO No. 125 four days later. This is the structural reason the suspension is temporary and conditional rather than a permanent rate cut: RA No. 12316 ties relief directly to a measurable, DOE-certified global price, not to a fixed calendar window chosen by the BIR.

Timeline: From RA No. 12316’s Trigger to RMC No. 100-2026 #

The suspension moved from certified price data to an enforceable BIR circular in under three weeks. Each step has its own legal document, and taxpayers should cite the correct one depending on whether they are discussing the price basis, the presidential order, or the BIR’s filing instructions.

How and When the Suspension Automatically Ends #

Unlike a standard rate change, this suspension is designed to expire on its own, without the BIR needing to publish a new circular lifting it. The reversion is tied to the same DOE-certified price measure that triggered the suspension in the first place, plus a hard three-month outer limit.

Reporting on the circular’s language describes the mechanism this way:

“The regular excise tax rates shall automatically revert, without need of further issuance, one week after the one-month average Dubai crude oil price falls below US$80 per barrel, as certified by the DOE, or three months from the effectivity of the EO, whichever comes first.”

In practice, that means two possible end dates are running in parallel from September 25, 2026: an early exit if crude prices fall back under $80/barrel (with a one-week grace period after DOE certification), or a hard stop around late December 2026 if prices stay elevated. Taxpayers should not assume the suspension runs the full three months — a sustained price drop could end it weeks or months sooner, and the BIR is not required to announce the reversion before it takes effect.

Worked Example: Tax Relief on an LPG Tank and a Drum of Kerosene #

News coverage of RMC No. 100-2026 pegs the relief at roughly ₱3 per kilogram of LPG and ₱5 per liter of kerosene — lower than the roughly ₱3.36/kg and ₱5.60/liter relief reported during the earlier April 2026 round, reflecting differences in how the suspended amount is computed against prevailing prices. Applying the September figures to common retail volumes shows the relief in peso terms:

• An 11-kilogram LPG cylinder (the standard household tank size): excise tax otherwise due is approximately 11 kg × ₱3/kg = ₱33 per refill. While RMC No. 100-2026 is in effect, that ₱33 component is not collected on qualifying household/commercial LPG removals.
• A 20-liter drum of kerosene, sold by a sari-sari store or hardware supplier: excise tax otherwise due is approximately 20 L × ₱5/L = ₱100 per drum. That amount is suspended for the duration of EO No. 125, for kerosene not used as aviation fuel.
• The same LPG diverted to motive power or petrochemical feedstock, or kerosene sold as aviation fuel (Jet A-1), does not get this relief — the distributor or importer still computes and remits the regular excise tax on those specific removals, and must segregate them from the suspended-rate volumes when preparing BIR Form 2200-P.

A distributor handling both household LPG and industrial feedstock LPG in the same reporting period therefore cannot apply one blanket rate — removals have to be tagged by end-use to determine which ones qualify for the RMC No. 100-2026 suspension.

What’s Still Taxed: The Three Carve-Outs #

The suspension is broad but not unconditional. Three specific uses remain fully taxable at regular excise rates even while RMC No. 100-2026 is in effect, and distributors who misclassify them risk deficiency excise tax assessments once the BIR reconciles Form 2200-P filings against actual product movement.

1. LPG used as motive power — LPG sold or used as vehicle fuel (e.g., autogas) does not qualify for the suspension.
2. LPG used as petrochemical feedstock — LPG consumed as a raw material in petrochemical manufacturing is excluded and taxed normally.
3. Kerosene used as aviation fuel — aviation-grade kerosene (jet fuel) is excluded; only non-aviation kerosene (the kind sold for lamps, stoves, and small engines) gets the suspension.

Related excise mechanics — how BIR Form 2200-P is filed, how fuel marking under the BIR Fuel Marking Program verifies that removed volumes match what’s declared, and how rates are computed in normal (non-suspended) periods — are covered in our companion guides, since this post focuses specifically on the temporary suspension rather than excise tax mechanics generally.

This Is a Renewed Suspension, Not a New Policy #

RMC No. 100-2026 is not the first time RA No. 12316’s price trigger has fired in 2026. An earlier suspension took effect around April 2026 (its filing rules are covered in RR No. 3-2026: Filing Rules for the LPG and Kerosene Excise Tax Suspension) once Dubai crude first breached the $80/barrel threshold that year, offering slightly higher relief (roughly ₱3.36/kg on LPG and ₱5.60/liter on kerosene, per contemporaneous reporting) before crude prices eased and the suspension lapsed. When Dubai crude climbed back to US$99.41/barrel over the August–September 2026 certification window, the same statutory mechanism triggered a second round — EO No. 125 and RMC No. 100-2026 — rather than requiring Congress to pass new legislation. Expect this pattern to repeat: as long as RA No. 12316 remains in force, any future DOE-certified breach of the $80/barrel threshold can trigger another suspension through a new EO and implementing RMC, and each lapses on its own under the same automatic-reversion rule.

Frequently Asked Questions #

Is the excise tax on LPG and kerosene currently suspended in the Philippines? #

Yes. Under BIR Revenue Memorandum Circular No. 100-2026, issued September 28, 2026, the excise tax on liquefied petroleum gas (LPG) and kerosene is fully suspended, implementing Executive Order No. 125, series of 2026, signed by President Marcos Jr. on September 25, 2026.

What is BIR RMC No. 100-2026? #

RMC No. 100-2026 is the Bureau of Internal Revenue circular that operationalizes Executive Order No. 125’s suspension of excise tax on LPG and kerosene, issued after the Department of Energy certified that Dubai crude oil averaged US$99.41 per barrel from August 13 to September 11, 2026 — above the US$80 threshold set under Republic Act No. 12316.

What LPG and kerosene uses are not covered by the suspension? #

The suspension excludes LPG used as raw material for petrochemical products or for motive power (vehicle fuel), and excludes kerosene used as aviation fuel. Excise tax on those specific uses continues to apply at regular rates.

How long will the LPG and kerosene excise tax suspension last? #

Regular excise tax rates automatically revert, without need of a further BIR issuance, either one week after the one-month average Dubai crude price (MOPS basis) falls below US$80 per barrel as certified by the DOE, or three months from the effectivity of Executive Order No. 125 — whichever comes first.

Does RMC No. 100-2026 also suspend excise tax on gasoline or diesel? #

No. Executive Order No. 125 and RMC No. 100-2026 cover only LPG and kerosene. Gasoline and diesel excise tax rates are unaffected by this suspension.

Is this the first time LPG and kerosene excise tax has been suspended in 2026? #

No. RMC No. 100-2026 is a renewed suspension — an earlier round took effect around April 2026 under the same Republic Act No. 12316 mechanism, lapsed as crude prices eased, and was then reinstated in September 2026 once Dubai crude climbed back above the $80-per-barrel trigger.

Summary #

BIR RMC No. 100-2026, issued September 28, 2026, confirms that excise tax on LPG and kerosene is suspended again, implementing Executive Order No. 125 (signed September 25, 2026) under Republic Act No. 12316’s $80-per-barrel price trigger — breached when Dubai crude averaged US$99.41/barrel from August 13 to September 11, 2026. The relief excludes LPG used for motive power or petrochemical feedstock and kerosene used as aviation fuel, and it ends automatically — one week after DOE-certified Dubai crude falls back below $80/barrel, or three months from EO No. 125’s effectivity, whichever comes first — without any further BIR circular needed. Distributors and importers filing BIR Form 2200-P must still segregate suspended-rate volumes from the excluded uses, and should watch BIR.gov.ph for the next DOE certification that could end — or renew — this cycle.