The executive order that modified the tariff rates for Electric Vehicles (EVs) is set to undergo a mandatory review next week. Stakeholders are hopeful that the review will result in the expansion of the order to include e-motorcycles in the list of vehicles eligible for tax breaks. This development could have far-reaching implications for the promotion of green transport and the reduction of carbon emissions in the country.
EO No. 12, which was uploaded in the Official Gazette on January 19, 2023, is scheduled for review beginning February 21, 2024. The order was issued as a complement to the Electric Vehicle Industry Development (Evida) law, with the aim of mainstreaming EVs and encouraging their adoption in the Philippines.
Under the executive order, different types of electric vehicles and their components were granted lower tariff rates, ranging from five to thirty percent, down to zero percent import duty. This includes passenger cars, buses, minibuses, vans, trucks, motorcycles, tricycles, scooters, and bicycles. These reduced tariff rates are applicable for a five-year period.
However, it is important to note that EO No. 12 does not currently apply to e-motorcycles, which are still subject to a 30 percent import charge. This has raised concerns among EV industry stakeholders, who argue that e-motorcycles should also be eligible for tax breaks from the government.
According to the Statista Research Department, there were approximately 7.81 million registered private motorcycles and tricycles in the Philippines in 2022. Given the significant number of motorcycles on the road, Albay Rep. Joey Salceda has taken action by filing House Bill 9573. This bill seeks to include e-motorcycles in the list of EVs that would benefit from tax breaks.
Salceda highlights the fact that around 60 percent of electric vehicles worldwide are two-wheeled vehicles, making them the most common mode of electric transport. Excluding e-motorcycles from the tax incentives granted under the law not only fails to address congestion issues but also limits the potential for a significant shift away from petroleum-fueled vehicles.
“In order to address these issues, this proposal clarifies in its definition of terms that electric vehicles include two-wheeled vehicles. Additionally, the measure provides a zero-percent duty treatment on completely-built electric vehicles to accelerate the shift to these types of vehicles,” Salceda stated in filing the bill.
The National Economic and Development Authority, which recommended the five-year implementation of EO No. 12, will be submitting its findings and recommendations to the Office of the President through the Office of the Executive Secretary as part of the review process.
As the review of the executive order approaches, stakeholders in the EV industry eagerly await a decision that could pave the way for a more inclusive and sustainable transportation sector in the Philippines. The potential expansion of tax breaks to include e-motorcycles would not only encourage the adoption of electric two-wheelers but also contribute to the overall reduction of carbon emissions and the promotion of a greener future.
In conclusion, the upcoming review of EO No. 12 presents an opportunity to address the current exclusion of e-motorcycles from tax breaks. By expanding the scope of the executive order to include these vehicles, the government can further promote the adoption of electric transport and contribute to a more sustainable future for the Philippines.
Source: The Manila Times
