Tariff Commission Recommends Tax Breaks for E-Motorcycles

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The Tariff Commission Recommends Inclusion of E-Motorcycles in Tax Breaks for Electric Vehicles

The Tariff Commission (TC) has recently recommended to the National Economic and Development Authority (NEDA) the inclusion of e-motorcycles in its list of electric vehicles (EVs) eligible for import tax breaks. This move aims to promote the use of e-motorcycles as an environmentally-friendly mode of transportation and support the growth of the electric vehicle industry in the country.

The TC, an attached agency of NEDA, submitted a report on April 12th, detailing its review of Executive Order (EO) 12 to the NEDA. The report suggests the implementation of reduced import tax rates for e-motorcycles. This recommendation comes after a series of public hearings conducted by the TC, where stakeholders presented their arguments and data-backed positions in favor of granting tax breaks to e-motorcycles.

EO 12, which came into effect in February 2023, currently imposes a 30 percent import tax on e-motorcycles, while other types of EVs enjoy reduced or zero tariff rates. Industry leaders in the EV sector have been actively campaigning for the inclusion of e-motorcycles under this executive order, questioning its intent and advocating for its revision during the review process.

According to the Statista research department, there were 7.81 million registered motorcycles in the country in 2022, making them the most popular type of vehicle among motorists. Recognizing the significant number of motorcycles on the road, think tank Stratbase ADR Institute and advocacy network CitizenWatch Philippines have been actively pushing for tax breaks for e-motorcycles since 2023. They highlight the environmental and economic benefits that e-motorcycles can bring once integrated into the country’s traffic system.

One of the key advantages of e-motorcycles is their zero emissions, which contribute to reducing carbon dioxide (CO2) emissions from the transportation sector. In 2022, the transportation sector alone emitted 35.42 million tons of CO2, contributing to climate change, as reported by Statista. By promoting the use of e-motorcycles, the government aims to address this issue and work towards fulfilling its commitment to the Paris Agreement.

The Department of Energy also supports the expansion of the country’s EV fleet by 50 percent, which would mean adding an additional 2.4 million units. This ambitious goal aligns with the government’s vision of transitioning to “green transportation” and reducing the country’s carbon dioxide emissions.

EO 12 was enacted to complement the Electric Vehicle Industry Development Act, which aims to establish a robust EV industry in the country. The modification of tariff rates for EVs, including the proposed tax breaks for e-motorcycles, is a crucial step in mainstreaming the use of EVs among Filipinos and promoting sustainable transportation options.

In conclusion, the Tariff Commission’s recommendation to include e-motorcycles in tax breaks for electric vehicles is a significant development in the promotion of sustainable transportation in the Philippines. The potential reduction in import taxes for e-motorcycles will not only incentivize their use but also contribute to the country’s efforts in reducing carbon emissions and meeting its commitments under the Paris Agreement. As the government continues to deliberate on the TC’s report, it is hoped that the final decision will support the growth of the electric vehicle industry and pave the way for a greener and more sustainable future.

Source: The Manila Times

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