Tax break for 2-wheeled EVs gains ground in Congress
Giving tax breaks for twowheeled electric vehicles (EVs) is getting more support from Congress, as a bill aiming for their inclusion in the list of vehicles benefiting from tariff reduction has been filed in the House of Representatives.
Albay 2nd District Rep. Joey Salceda filed House Bill 9573 which aims to amend Executive Order 12 issued in 2022 which modifies the tariff rates for certain EVs and their parts and components to boost green transportation in the country.
Two-wheeled electric motorcycles were not given tax breaks under EO 12, even though they comprise the majority of EVs in the country, Salceda said.
Under EO 12, only kick scooters, self-balancing cycles, bicycles and pocket motorcycles with auxiliary motors not exceeding 250 watts and with a maximum speed of 25 km/hour have zero percent import duties. On the other hand, electric motorcycles are still subject to a 30 percent tariff rate.
The lawmaker also said e-motorcycles were not given proper treatment, as these are the most affordable types of EVs and can be adopted easily, and their non-inclusion is counterproductive when it comes to solving congestion.
“Some 60 percent of EVs are two-wheeled, meaning that the vast majority of EVs do not benefit from the tax incentives granted under the law... encouraging electric cars while locking out electric motorcycles does not address congestion issues, but merely substitutes petroleum-fueled cars for their space on the road,” Salceda said.
“In order to address these issues, this proposal clarifies in its definition of terms that EVs include two-wheeled vehicles. Additionally, the measure provides a zero-percent duty treatment on completely-built EVs to accelerate the shift to these types of vehicles,” he added.
The non-inclusion of emotorcycles in the list of EVs gained the disapproval of different stakeholders of the industry, noting that it is unfair to the majority of motorists in the Philippines, including mobility advocates, business owners and environmentalists.
In a study conducted by American business consulting firm Frost and Sullivan in 2018, a total of 93 percent of surveyed Filipinos said that they are open to buying EVs in the future.
The Electric Vehicles Association of the Philippines projected the EV market to grow at an annual rate of eight to 12 percent over the next 10 years. This equates to about P1.68 billion in revenue and sales of 200,000 units by 2024.
EO 12 is up for review this month, according to the National Economic Development Authority.
The push for EVs has been one of the primary ways that the Philippine government is introducing to help reduce carbon emissions. To ramp this up, the Electric Vehicle Industry Development Act (EVIDA) has been enacted into law to create an industry supporting the EV transition of the country.