The Finance Ministry has indicated its non-opposition to a proposal by the Energy Ministry granting the state Oil Fuel Fund the ability to collect oil taxes autonomously.
Deputy Finance Minister Julapun Amornvivat conveyed that Energy Minister Pirapan Salirathavibhaga proposed the idea of empowering the Oil Fuel Fund to independently set oil tax rates.
Mr. Julapun expressed interest in the proposal, suggesting that if adjustments are made to empower the fund to collect oil taxes for the benefit of the public, then it should move forward. However, he noted the necessity for a collective discussion with relevant government agencies to garner their perspectives.
Currently, the Excise Department is responsible for oil tax collection, and Mr. Julapun highlighted the prevailing policy inclination towards transitioning the energy sector to cleaner sources. He reassured that restructuring oil tax collection should not hinder this transition.
Since 2004, under Prime Ministerial Order No.4/2004, the Oil Fuel Fund has been authorized to regulate oil prices, including the setting of oil tax ceilings to manage domestic oil prices. However, the actual collection of oil taxes remains under the Finance Ministry’s jurisdiction.
In 2019, the Oil Fuel Fund was stripped of its authority to set oil tax ceilings, retaining only the power to determine oil price caps. An anonymous source from the Energy Ministry emphasized the need for further discussions between the Finance and Energy ministries on this matter.
Discussions are reportedly ongoing concerning a potential shift in the oil tax collection method to a levy system, contingent upon approval from the Finance Ministry.
As of May 5, the fund disclosed a total loss of 109 billion baht, with significant portions attributed to subsidies for diesel, gasohol, and liquefied petroleum gas (LPG) prices.
Recently, the cabinet endorsed measures aimed at alleviating energy costs for the public, including capping diesel and cooking gas prices and providing subsidies for electricity bills among vulnerable groups.
Under these initiatives, diesel prices will be capped at 33 baht per litre until the end of July, retail LPG prices will be fixed, and electricity discounts will be extended to eligible residential consumers.
Funds from the Oil Fuel Fund will be utilized for these purposes, with additional support from the government’s central budget if needed for emergency or essential expenditures.
