부산대학교 도서관

Crude oil and its derivatives - refined petroleum products - are taxed by the Philipine government in a variety of ways including import duties on imported crude oil, specific taxes on refined petroleum products, and an ad valorem tax. The revenue generated from these duties and taxes accounts for approximately 25 percent of the government's total revenue. Recently, concern has been raised that this concentration of the tax base on a single industry is very inefficient and has potentially debilitating effects for the overall growth of the economy. For instance, one of the dangers posed by the excessive taxation of petroleum in the Philipines is the distortion of factor prices and its consequent effects on investment decisions. Alcohol production from sugarcane is one example. At prevailing after-tax petroleum prices, the production of alcohol fuel from surgarcane is economically viable. Based on the price of petroleum products in the absence of taxes on refined petroleum products, however, it is not. While the tax-adjusted price of petroleum makes investment in the alcohol program desirable, it contributes to underinvestment in energy-intensive industries such as commercial fishing, cement production, construction, and road and freight transportation. This makes the costs of the goods and services to other sectors of the economy higher so that prices of the output in the sectors where the Philippines has a comparative advantage relative to other countries in the world are higher and, correspondingly, the goods and services produced are less competitive than they might otherwise be. This article examines the costs to the Philippine economy of taxing the petroleum industry so heavily. 27 refs., 11 tabs.