The Market Monitor Minding the Nation's Business
By Rose de la Cruz
The Electric Vehicle Association of the Philippines (EVAP) – a legitimate industry group just like the car manufacturers – is pushing for tax breaks to e-motorcycles to help create a local e-vehicle manufacturing in the country. Needless to say that e-motorcycles and other electric transport systems are mostly imported.
The government just recently granted tax breaks to car manufacturers but has shown encouragement to electric vehicles, which it regards as adding mess to the traffic in Metro Manila.
The group is among the stakeholders that have been calling for the inclusion of e-motorcycles for the tax breaks to electric vehicles (EVs) amid the ongoing review on whether or not e-motorcycles should be given the same privilege.
Currently, the Tariff Commission has been conducting a public hearing to review Executive Order No. 12 series of 2023, which started on March 13, or more than a year after the EO initially took effect, the Manila Bulletin reported.
Aside from EVAP, other groups and agencies that backed the tax break proposal are the Department of Trade and Industry’s Board of Investment (DTI-BOI), the Department of Energy (DoE), and the Autohub Group.
At the public hearing, DoE specialist for Energy Utilization Management Bureau Andre Reyes said giving tax breaks to e-motorcycles will help with faster EV adoption in the country.
“This proposed coverage expansion will send a clear price signal for consumers to switch to EVs, which are more efficient and cheaper to run per kilometer, and assist in energy self-sufficiency,” Reyes said.
Under EO12, different types of EVs got tax breaks, while e-motorcycles are still subject to a 30 percent tariff rate.
The exclusion of e-motorcycles in the tax breaks drew the ire of different stakeholders, noting the ‘unfair’ treatment that these modes of transport received while holding the majority of numbers among motorists in the country with around 8 million registered units, Statista Research Department said.
EVAP wants to give tax breaks to e-motorcycles for a limited time, to help create an industry for their manufacturing in the country.
“The granting of tariff exemption should be limited only to one year with a commitment to at least do a CKD (completely knocked down) of the same model or another model on the second year,” EVAP said in its position paper.
The Tariff Commission also asked the stakeholders present in the meeting to submit their updated position papers by Monday, March 18.
Earlier, Albay 2nd District Representative Joey Salceda also filed House Bill No. 9573 to apply modifications to EO12, as the lawmaker noted that 60 percent of the nation’s electric vehicles are classified as two-wheeled, which makes it unfair for them to be excluded from tax breaks.
EO12 was enacted to complement the Electric Vehicle Industry Development Act (EVIDA) to create an industry for EVs in the country and help reduce carbon emissions, in compliance with the Philippines’ commitment to the Paris Agreement. It modifies the tariff rates for EVs to help mainstream their use among Filipinos.
The DTI also plans to phase out internal engine combustion cars as part of a comprehensive plan to transition the nation to what environmentalists refer to as “green traffic,” or a decarbonized road network.