House panel to tackle auto excise tax today
THE House Ways and Means committee is set to hold its third deliberation on the Department of Finance-backed comprehensive tax reform package today, zeroing in on the provision in the bill seeking to increase excise taxes on automobiles.
The committee, chaired by Quirino Rep. Dakila Carlo E. Cua, invited officials of the Department of Transportation, Department of Trade and Industry, Finance department, Land Transportation Office, Land Transportation Franchising and Regulatory Board, Bureau of Customs, and Bureau of Internal Revenue, among others, to give their views on the proposed legislation.
The committee also invited representatives from the automobile industry such as Chamber of Automotive Manufacturers of the Philippines, Inc.; Association of Vehicle Importers and Distributors; Automobile Association Philippines; CATS Motors, Inc.; Jaguar Philippines, Inc.; Chevrolet Motors Philippines, Inc.; Philippine National Taxi Operators Association; Confederation of FX- AUV Operators and Drivers Association; Ford Motor Co. Philippines, Inc.; Isuzu Philippines Corp.; Nissan Philippines, Inc.; Mitsubishi Motors Philippines, Inc.; Toyota Motors Philippines, Inc.; PGA Cars, Inc.; Prestige Cars, Inc.; Berjaya Auto Philippines, Inc.; and Laus Group.
Finance Secretary Carlos G. Dominguez III said earlier that proposal to raise excise taxes on automobiles would help ease the worsening traff ic problem in Metro Manila and other major cities like Cebu and Davao. “The point of the matter is we want to direct the people to go to public transport, and we are making big investments in public transport — particularly the bus rapid transit system — and we’re fixing the trains, whose maintenance has been neglected over the years,” Mr. Dominguez explained earlier, adding that: “So we are going to make public transport more available. We have to discourage new cars because just look at the traff ic: it’s not moving.”
Under the House Bill 4774 of the proposed “Tax Reform for Acceleration and Inclusion Act,” drafted by the Finance department and filed by Mr. Cua, the excise tax on automobiles will be raised to 4% from the present 2% if the net manufacturer’s price/ importer’s selling price is up to P600,000.
If the price is P600,000 to P1.1 million, the tax rate will be P24,000 plus 40% of the value in excess of P1.1 million. The present tax rate is P12,000 plus 20% of the value in excess of P1.1 million.
If the price is over P1.1 million to P2.1 million, the tax rate shall be P224,000 plus 100% of value in excess of P1.1 million. The present tax rate is P112,000 plus 40% of value in excess of P1.1 million.
If the price is P2.1 million, the tax rate will be P1.224 million plus 200% of the value in excess of P2.1 million. The current rate is 512,000 plus 60% of the value in excess of P2.1 million.